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Indonesian financial authorities ban crypto support, draws criticism

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OJK Controversy Bans Crypto Facilitation, This is Observer’s Response

Jakarta, Gizmologi – The statement by the Financial Services Authority (OJK) and the Investment Alert Task Force (SWI) regarding the prohibition of banks from facilitating crypto transactions has drawn controversy.

The reason is, the OJK statement prohibiting crypto facilitation is not in tune with the policies of other institutions. Crypto assets have been confirmed as one of the commodities traded with supervision under the Commodity Futures Trading Regulatory Agency (Bappebti).

Anto Prabowo, Deputy Commissioner for Public Relations and Logistics at OJK, in a press statement last Friday (02/04) said that his party is coordinating with SWI to ensure bank accounts are not used to carry out unlawful acts such as fraud, gambling, money laundering, illegal investments, and/or containing a ponzi scheme.

“OJK also asks the banking industry to ensure that the use of bank accounts does not violate the law. Banks are asked to be vigilant so that bank accounts are not used as a reservoir for funds from activities such as cryptocurrencies or investments with Ponzi schemes,” said Anto.

Chairman of the OJK Board of Commissioners Wimboh Santoso, also emphasized that OJK prohibits financial service institutions from facilitating crypto asset trading. According to him, crypto is very risky because it does not have a strong fundamental value, but it is very risky volatile. While the community has done a lot of trading cryptocurrencies who may not yet understand the risks that will be posed.

“The investment carries a very high risk because it has almost no fundamental value. Several regulators around the world have also expressed concerns that digital financial products may be used for money laundering activities,” said Wimboh.

Experts Criticize OJK’s Statement Forbidding Crypto Facilitation

crypto exchange illustration
Illustration of crypto assets (Photo: 123rf / dimarik16)

Teguh K. Harmanda, Chairman of the Indonesian Crypto Asset Traders Association (Aspakrindo) said the association appreciated the statement from the OJK forbidding crypto facilitation. However, so far the association has made efforts to place crypto trading by the rules and complete legal protection.

According to him, this is appropriate for Aspakrindo to keep the industry growing healthyly. For example, in the crypto-asset industry, which has implemented recommendations for AML/CFT, there are reports required by Bappebti every day, and reporting if they find suspicious transactions.

“We are very confident that the current crypto asset transactions are in sync with the risk mitigation that we are all worried about in the financial industry at large,” said Teguh.

Meanwhile, Nailul Huda, Researcher at the Institute for Development of Economics and Finance (Indef) assessed that the OJK statement indicated that there was inconsistency between government agencies. This is because crypto assets themselves have been designed as commodities by Bappebti under the Ministry of Trade (Kemendag).

Bappebti has also formally drafted rules regarding crypto trading and traders. This means that as long as transactions are carried out by crypto traders registered and supervised by Bappebti, crypto trading schemes are like commodities or other derivative products.

“On the one hand Bappebti is trying to facilitate this industry, but on the other hand there are other institutions that have different views. OJK and Bappebti must be talk first. This trend of crypto assets has been going on for the last few years,” Nailul quipped.

OJK reserves the right to ban illegal cryptos

cryptojacking 2 edit

Furthermore, he understands the OJK’s point of view, which still perceives crypto assets as a potential medium of exchange like fiat money, because the name is cryptocurrency. Meanwhile, the official medium of exchange is the rupiah as regulated by law. “But since the beginning when Bappebti facilitated it, the agreement in Indonesia could only be used as an investment asset. Not a transaction tool,” he added.

Therefore, he considered that there were irregularities with the OJK’s call for banks not to Bappebti crypto asset transactions. Whereas since the beginning Bappebti formulated crypto as an investment commodity. “How can investors buy or invest in crypto assets if they can’t use a bank account as a bridge to buy or sell crypto assets to crypto traders? Right, this is a digital asset, it’s time to buy and sell it directly through merchants offline,” said Nailul.

However, Nailul agreed that OJK and SWI would prohibit illegal trade, including those carried out by unregistered crypto traders.

“So far, Bappebti has released which crypto and crypto coin traders are registered and officially licensed at Bappebti. That should be enough as a reference for monitoring and controlling bank involvement,” Nailul added.

Read: Get the Green Light! Bappeti Recognizes 229 Crypto Assets in Indonesia

Late Crypto Exchange Launch

Crypto Exchange
Illustration of a crypto asset (Photo: 123rf/Bjorn Beheydt)

Meanwhile, Director of PT TRFX Garuda Berjangka Ibrahim Ascustombi revealed that friction with the OJK will have an impact on the delay in launching the crypto exchange. This is because the function of financial institutions, in this case the bank, will be as a custodian for trading crypto assets. This custodian is the most important position.

Read also: 2021 Transactions Reach IDR 859 trillion, Government Prepares Crypto Exchange

“So I don’t wonder why the launch of this crypto exchange has been delayed from the second semester of 2021. Apparently there deadlock between Bappebti and OJK in carrying out state-recognized trading of crypto assets, in this case crypto exchanges,” said Ibrahim.

With these obstacles, it will make further impacts such as increasingly difficult for crypto assets to be accepted in the community. “In fact, there will be more and more crypto trading activities that are difficult to monitor for security. The state is increasingly difficult to regulate these crypto assets,” said Ibrahim.

 


The Indonesian version of this article can be read in Gizmologi.ID

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Tech journalist & blogger. Mobile photography enthusiast. Living in dangerously beautiful Indonesia.

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