Indonesian FSA crypto oversight transition stalled due to lack of government bill: report

The transition of crypto asset oversight in Indonesia from the Commodity Futures Trading Agency to the Financial Services Authority is reportedly facing delays due to a lack of supporting government regulation.

According to a recent report by Jakarta Globe, the transition of crypto asset supervisory authority from the previous agency, Bappebti under the Ministry of Trade to the Financial Services Authority is set to occur by Jan. 12, 2025. However, the transfer may be delayed even further due to a lack of supporting government regulation.

Chairman of the Indonesian FSA, known locally as OJK, Mahendra Siregar, assured reporters that authorities are currently in the process of coordinating discussions and making the necessary preparations for the incoming transfer.

“We’ve been working closely with the Trade Ministry to ensure a seamless process. Once the regulation is issued, it will provide the legal basis for the transition,” said Siregar.

The plan to handover crypto asset supervision from Bappebti to OJK was first introduced by Finance Minister Sri Mulyani in late 2022. The bill needed to officiate the transition between the two government bodies would require both the legislative and executive branches in the Indonesian government to reach an agreement on all provisions. At the time of writing, the official government bill for the Jan. 12 transition has yet to be published.

According to the report, both OJK and Bappebti have confirmed that they are bracing for the transition. OJK Commissioner Hasan Fawzi said the agency has been studying how different countries implement crypto regulations and are training its regulators to take on the role. While Bappebti Head Kasan said the existing rules regarding crypto in the country would remain effective until new regulations are enacted by OJK.

Many local industry players, including brokers and exchange firms, are anticipating the transition because they see the move as a step forward in regulating the crypto sector and legitimizing crypto trading for investors. OJK works closely with the central bank of Indonesia, in regulating the financial sectors, which could potentially streamline crypto regulations in the future.

In December, Bank Indonesia completed the Proof of Concept necessary for Project Garuda, the pilot project for Indonesia’s very own central bank Digital Currency.