Indonesia plans to authorize the Financial Service Authority (OJK) as the major regulator of the crypto market to better safeguard investors in the country, Reuters reported Thursday, citing statements from finance minister Sri Mulyani.
Per the report, the new bill is part of the financial sector legislation which is currently being debated in the parliament.
OJK is the regulator that oversees the financial services activities in banking, capital markets, and non-bank financial industry sectors in Indonesia.
Indonesia to Make OJK the Major Regulator of Crypto
Mulyani stated that the proposal aims to make OJK the major regulator of “digital asset activities, including crypto assets and financial sector technology innovation.”
“We need to build a mechanism of supervision and investor protection that is quite strong and reliable especially for investment instruments that are high risk,” Mulyani said in a parliamentary hearing.
Currently, the crypto market in Indonesia is being overseen and regulated by both the Trade Ministry and the Commodity Futures Trading Regulatory Agency.
While crypto is prohibited as a means of payment in Indonesia, offering crypto services in the form of investment products is allowed in the country.
Mulyani noted that she supports the proposal but stressed the need for the independence of financial regulators, especially those of Bank Indonesia (BI), the country’s central bank.
“It is important for us to continue to provide signals that independence and credibility of institutions … are strengthened and maintained because this is the most important asset to maintain financial system stability,” she said.
The parliament submitted the bill to the government in September and will be made law only after both the legislative and executive branches agree on the proposal.
Aside from proposing to make OJK the regulator of crypto, the bill also aims to “widen the central bank’s mandate to include economic growth in addition to price stability.”
Interest in Crypto Surges
Meanwhile, Indonesians have continued to show huge interest in crypto despite the strict regulatory stance by regulators in the country.
Mulyani revealed that as of June 2022, there were 15.1 million cryptocurrency investors in Indonesia compared to just 4 million in 2020.
