The Indonesian Financial Services Authority (OJK) has announced that local financial services institutions must participate in the regulatory sandbox if they want to introduce new products and services, including crypto assets. A report from DetikFinance, a local Indonesian media outlet, states that once crypto assets are regulated and supervised, they will also need to go through the sandbox. This means that crypto firms in the sandbox stage will undergo evaluation by the regulator before they can operate in the country. The sandbox is a tool that allows businesses to test and experiment with new innovative products or services for a limited period. The inclusion of crypto assets in the regulatory sandbox is aimed at eliminating fraudulent investments, according to Hasan Fawzi, the head of technology innovation, digital financial assets, and crypto assets supervision at OJK.
As part of this announcement, OJK will take over the regulation of the crypto industry from the country’s commodities agency, Bappebti, starting in January 2025. Currently, crypto assets are classified as commodities in Indonesia, but with the transfer of governance to OJK, they may be reconsidered as financial instruments. The crypto landscape in Indonesia has been growing, especially after the election of a pro-crypto vice president. Gibran Rakabuming Raka, the newly elected vice president, has promised to support the development of blockchain, crypto, artificial intelligence (AI), and cybersecurity expertise among local youth. In 2023, the country launched its national crypto exchange, the Indonesian Crypto Asset Futures Exchange, which is monitored by local regulators and is the only platform for legal digital asset exchange in the country. The exchange has also started conducting blockchain trials for public services. Earlier this year, Indonesian officials were considering changes to the dual taxation on crypto, including the capital gains tax and VAT on crypto transactions.