Report: In Indonesia legal Bitcoin is based on commodities

[kaisa]

Based on the release issued by the Ministry of Commerce of the Republic of Indonesia through the State News, Indonesia positioned cryptocurrency as a commodity. This states that Indonesia allows cryptocurrency to circulate in the community. The Ministry of Trade of the Republic of Indonesia authorizes BAPPEBTI (Institute for Commodity Trading Supervision) similar to the SEC, to immediately issue rules relating to cryptocurrency trading. (if it has been published immediately updated).

Important note is that Indonesia refuses to use cryptocurrency as a payment transaction tool, based on law Number 7 of 2011 concerning Currency and Bank Indonesia rules Number 17/3/PBI/2015 concerning the Obligation to Use Rupiah in the Territory of the Republic of Indonesia.

While the rules for crowdfunding, Indonesia are regulated by the Financial Services Authority (OJK) through POJK.04/2018 regarding Equity Crowdfunding. Where all institutions that will conduct crowdfunding must have OJK permission and at a minimum the company must be a limited liability company (Perseroan Terbatas) or cooperative. This rule also limits the maximum value of the share offer of Rp. 10 billion (USD800 million).

Note: If there is a renewal, I will update it immediately.

[hugeblack]

Bitcoin is defined as a commodity because it is difficult to define it as a currency. According to the laws governing financial transactions, there is a need for a legislative authority that guarantees the issuing of currencies and the exchange of currency which is not available in BTC or other cryptos.
According to these laws, Bitcoin cannot be defined as a currency, because it exists and has a value known as a commodity.

I expect this concept to change if cryptocurrency is recognized "and regulated" by major governments or the G20.

[Theb]

I think this is already happening since last year, Indonesia has cleared cryptocurrencies to be traded in their country.

Indonesia’s markets regulator under the Ministry of Trade, the Future Exchange Supervisory Board (Bappebti), has reportedly signed a decree to allow cryptocurrency trading on futures exchanges as a commodity.

This news came out last June 2018, the only thing good about this news is that they are confirming the legality of cryptocurrencies in their country. The problem is I haven't seen any exchanges yet being announced as licensed by the Indonesian government which is an important thing if they really want to see how this kind of regulation will work in their country.

[avikz]

It's good that Indonesia is taking good measures for the cryptos, hope it will help the adoption rate to increase to a higher level. There are certain benefits as well as certain drawbacks if bitcoin is recognized as a commodity. Lets look at those,

Benefits:
1. Trading exchanges can now legally add bitcoin to be traded as a commodity. It can be either delivery trade or futures trading.
2. Anyone would be able to "exchange" their bitcoin for local fiat without going through 3rd party platforms.

Drawbacks:
1. Bitcoins can't be used for purchasing goods and services.

There are many countries like Cyprus, Finland, Canada etc. have recognized bitcoin as a commodity and not as a currency. So the move taken by Indonesian Government is obviously good but what impact it will bring, that only time will tell!

[joniboini]

2. Anyone would be able to "exchange" their bitcoin for local fiat without going through 3rd party platforms.

We've been able to do that even before this rule comes out. And even if there's no clear statement about Bitcoin, we will still be able to do it and the government will need serious time and effort if they want to stop P2P exchange.

I think your first benefits is the most important one. Traders or crypto enthusiast would no longer need to feel anxious when they use cryptocurrency exchange because it is allowed by the government. If it was banned, then they'll need a hard time to exchange Bitcoin to fiat.

[Kemarit]

I think this is already happening since last year, Indonesia has cleared cryptocurrencies to be traded in their country.

Indonesia’s markets regulator under the Ministry of Trade, the Future Exchange Supervisory Board (Bappebti), has reportedly signed a decree to allow cryptocurrency trading on futures exchanges as a commodity.

This news came out last June 2018, the only thing good about this news is that they are confirming the legality of cryptocurrencies in their country. The problem is I haven't seen any exchanges yet being announced as licensed by the Indonesian government which is an important thing if they really want to see how this kind of regulation will work in their country.

As far as I know there's (https://indodax.com/). But it would be great to see exchanges popping around that country as well. Maybe the government is really reviewing before they give the go signal. Or procedures are not currently in place for regulatory body to approved it. Give them some time though, because it looks like Asia is really spearheading this new revolution.

[jrrsparkles]

2. Anyone would be able to "exchange" their bitcoin for local fiat without going through 3rd party platforms.

We've been able to do that even before this rule comes out. And even if there's no clear statement about Bitcoin, we will still be able to do it and the government will need serious time and effort if they want to stop P2P exchange.

I think your first benefits is the most important one. Traders or crypto enthusiast would no longer need to feel anxious when they use cryptocurrency exchange because it is allowed by the government. If it was banned, then they'll need a hard time to exchange Bitcoin to fiat.

But they can't ban localbitcoin right so people will be still able to make bitcoin to fiat or vice versa until they can be able to find the sellers and buyers.

[nc50lc]

We've been able to do that even before this rule comes out. And even if there's no clear statement about Bitcoin, we will still be able to do it and the government will need serious time and effort if they want to stop P2P exchange.
-snip-

But they can't ban localbitcoin right so people will be still able to make bitcoin to fiat or vice versa until they can be able to find the sellers and buyers.

@joniboini
LBC is a regulated third-party platform (and later implemented KYC), thus, I cannot totally consider it as a P2P exchange.@jrrsparkles
Bitcoin as a commodity doesn't mean that it can't be directly traded with fiat. Actually, it's the exact opposite, it can be legally traded through any legal means.
What's being banned is purchasing goods, paying your bills or services using bitcoins, but that can be easily covered by third-party payment processors by indirectly converting Bitcoins into fiat to pay their listed payment options.

[joniboini]

But they can't ban localbitcoin right so people will be still able to make bitcoin to fiat or vice versa until they can be able to find the sellers and buyers.

@joniboini
LBC is a regulated third-party platform (and later implemented KYC), thus, I cannot totally consider it as a P2P exchange.

I'm not sure why you guys considered me talking about Localbitcoins. Did I mention it in my post? I don't even recall writing about Localbitcoin here.

I'm talking about P2P, like peer-to-peer exchange as a way to trade, such as exchanging Bitcoin here on the forum, or using Telegram, or directly face-to-face. We've been able to do that since years ago and I'm sure it will be difficult for the government if they want to eradicate it. That's what I'm trying to say.

[nc50lc]

I'm not sure why you guys considered me talking about Localbitcoins. Did I mention it in my post? I don't even recall writing about Localbitcoin here.

(lol) Sry, I was lost in thoughts by the post of the other guy that assumed localbitcoins as the P2P Exchange that you're talking about.
But anyways, you still got the point.

guys u see this pattern or
-link sniped-

I don't know what you're trying to share or ask but, the image isn't displayed but requested to be downloaded as a screensaver (which is very suspicious).
Reported for a possible malware. Just reupload it in any reputable image hosting site like imgur.com

[jrrsparkles]

But they can't ban localbitcoin right so people will be still able to make bitcoin to fiat or vice versa until they can be able to find the sellers and buyers.

@joniboini
LBC is a regulated third-party platform (and later implemented KYC), thus, I cannot totally consider it as a P2P exchange.

I'm not sure why you guys considered me talking about Localbitcoins. Did I mention it in my post? I don't even recall writing about Localbitcoin here.

I'm talking about P2P, like peer-to-peer exchange as a way to trade, such as exchanging Bitcoin here on the forum, or using Telegram, or directly face-to-face. We've been able to do that since years ago and I'm sure it will be difficult for the government if they want to eradicate it. That's what I'm trying to say.

I just had this query when I read that post,LBC is also a P2P exchange but not completely because they were asking to complete verification to complete registration after their updated terms and condition.I am also got the point even government ban they can't completely to do it.

[kaisa]

I think this is already happening since last year, Indonesia has cleared cryptocurrencies to be traded in their country.

Indonesia’s markets regulator under the Ministry of Trade, the Future Exchange Supervisory Board (Bappebti), has reportedly signed a decree to allow cryptocurrency trading on futures exchanges as a commodity.

This news came out last June 2018, the only thing good about this news is that they are confirming the legality of cryptocurrencies in their country. The problem is I haven't seen any exchanges yet being announced as licensed by the Indonesian government which is an important thing if they really want to see how this kind of regulation will work in their country.

Hi, You are right that the news on the ban on payment transactions using the cryptocurrency was published last June, but actually in 2014 the Indonesian central bank also banned the use of crypto for payment transactions. I give this update so that everyone knows that in Indonesia it is still open to cryptocurrency investment. This is important for many people to know.

[buwaytress]

Thanks for the update, but I believe that's been in existence since last year. So it's not new.

Indonesia is sort of like Malaysia or even the Philippines in this manner, where their central banks and/or monetary authorities and securities commissions can't really decide on what to enforce. They can issue all sorts of legalities but enforcement usually fails to follow through.

There is no fixed legal status for Bitcoin or other cryptocurrencies in Indonesia now. There can't be, not when Bitcoin is used, traded and accepted in many places, not when there are multiple commercial and private crypto companies running Point of Sale machines now (PundiX is one).

So the only thing we know for sure, is that Bitcoin is NOT illegal. Exactly what Bitcoin is? Yet to be determined.

[kaisa]

Thanks for the update, but I believe that's been in existence since last year. So it's not new.

Indonesia is sort of like Malaysia or even the Philippines in this manner, where their central banks and/or monetary authorities and securities commissions can't really decide on what to enforce. They can issue all sorts of legalities but enforcement usually fails to follow through.

There is no fixed legal status for Bitcoin or other cryptocurrencies in Indonesia now. There can't be, not when Bitcoin is used, traded and accepted in many places, not when there are multiple commercial and private crypto companies running Point of Sale machines now (PundiX is one).

So the only thing we know for sure, is that Bitcoin is NOT illegal. Exactly what Bitcoin is? Yet to be determined.

Indeed it is old news but the legality of cryptocurrency set by the Indonesian Ministry of Commerce as a form of a commodity is new news. Even the commodity supervisory body has made rules for digital transactions for commodity trading, it was prepared before the issuance of rules on how to trade crypto assets.

In Indonesian, there is currently no government-registered crypto platform. Pundi X, Tokenomy and Vexanium bags are issued based on Singapore authorities. Only the INDODAX exchanger is providing government licenses at this time, and that is also permitted as an exchange of money, not as a commodity trade.

[avikz]

2. Anyone would be able to "exchange" their bitcoin for local fiat without going through 3rd party platforms.

We've been able to do that even before this rule comes out. And even if there's no clear statement about Bitcoin, we will still be able to do it and the government will need serious time and effort if they want to stop P2P exchange.

I think your first benefits is the most important one. Traders or crypto enthusiast would no longer need to feel anxious when they use cryptocurrency exchange because it is allowed by the government. If it was banned, then they'll need a hard time to exchange Bitcoin to fiat.

Correct! I am not arguing that fact! Same here in my country as well! I can easily execute a p2p trade without platforms like Localbitcoins even though bitcoin is NOT a "legal tender" in my country. All I am saying that, now such kind of trades will not be seen under negative light and it can be more open to the public which will certainly help the adoption rate because the government itself is making it legal.

Initially when I started p2p trade, I had a really hard time to find another trader to execute such trade without going through the localbitcoins platform. First I had to execute a trade within that platform and then make a contact with that trader outside localbitcoins platform. This process of finding another party will become much easier and people will be more open about it.

[buwaytress]

Correct! I am not arguing that fact! Same here in my country as well! I can easily execute a p2p trade without platforms like Localbitcoins even though bitcoin is NOT a "legal tender" in my country. All I am saying that, now such kind of trades will not be seen under negative light and it can be more open to the public which will certainly help the adoption rate because the government itself is making it legal.

Initially when I started p2p trade, I had a really hard time to find another trader to execute such trade without going through the localbitcoins platform. First I had to execute a trade within that platform and then make a contact with that trader outside localbitcoins platform. This process of finding another party will become much easier and people will be more open about it.

That's sort of the point of p2p, unbound by state legality. In fact, in the past few years, every time a government's banned Bitcoin trading, it's only served to fuel p2p trades. I believe these bans have actually been a boon to p2p - if not for them, people may not have been motivated enough to seek out alternative routes. Good for everyone in the end.

P.S. Lots of other platforms other than LBC to try... Check out Bisq too!.

[1Referee]

In fact, in the past few years, every time a government's banned Bitcoin trading, it's only served to fuel p2p trades. I believe these bans have actually been a boon to p2p - if not for them, people may not have been motivated enough to seek out alternative routes. Good for everyone in the end.

Exactly. It also indicates that people aren't letting their government decide for them what to do, but actively look for an alternative way to conduct business, trade, etc. I like how easy it is with Bitcoin, because you only need a smartphone with an internet connection to participate in whatever economical activity.

The only downside to this is that governments slowly but surely start to notice how it's working against them, so they'll try to be more 'friendly' and regulate the centralized ecosystem rather than outright shitting on it. Seriously, it's way easier for governments to gain control over people by regulating the market in a friendly way than being so hostile and ban everything left and right, lol.

[buwaytress]

In fact, in the past few years, every time a government's banned Bitcoin trading, it's only served to fuel p2p trades. I believe these bans have actually been a boon to p2p - if not for them, people may not have been motivated enough to seek out alternative routes. Good for everyone in the end.

Exactly. It also indicates that people aren't letting their government decide for them what to do, but actively look for an alternative way to conduct business, trade, etc. I like how easy it is with Bitcoin, because you only need a smartphone with an internet connection to participate in whatever economical activity.

The only downside to this is that governments slowly but surely start to notice how it's working against them, so they'll try to be more 'friendly' and regulate the centralized ecosystem rather than outright shitting on it. Seriously, it's way easier for governments to gain control over people by regulating the market in a friendly way than being so hostile and ban everything left and right, lol.

Indeed, and that's precisely what Bitcoin users gain the most, and the more people understand that, the better the chances for Bitcoin's oft-mentioned mainstream adoption to continue growing. People keep saying censorship proof currency and while I'm not one for hyperbole, Bitcoin's as close as it gets to something accessible by all.

States will always learn after the fact, I guess. They'll take a long time yet to come to grips with new money. God knows fiat is putting up a fight.

[BitHodler]

States will always learn after the fact, I guess. They'll take a long time yet to come to grips with new money. God knows fiat is putting up a fight.

States haven't yet pulled out their big guns because crypto in its entirety hasn't posed much of a risk with how people mainly use it for speculative purposes. Only the most paranoid states act in advance, but they do that with everything.

On the other hand, I'm actually glad that crypto as it is hasn't been the currency we want and expect it to be. I prefer to see it gain more adoption in the coming years and then explode in their face.

I legit expected the US to be more hostile towards Bitcoin, but it has been doing relatively well in terms of being open minded. They probably know that there is no point in attempting to stop something that can't be stopped.

[elda34b]

On the other hand, I'm actually glad that crypto as it is hasn't been the currency we want and expect it to be. I prefer to see it gain more adoption in the coming years and then explode in their face.

Adoption is ongoing, more government have open up their stance to crypto. Indonesia is one of those few countries that does that. Even though Bitcoin is not legal yet as a medium of payment, but there's no further hostility about them. Cryptocurrency in general is viewed as speculative investment too.

That might change when there's enough supply and demand, when ICO product is working properly (maybe only a few of them) and when the majority of people know and use it on some degree. Like it or not, the average Joe in Indonesia knows about crypto due to bounty and stuff, so ICO play some part in it. But it might change sooner or later.

[timerland]

Based on the release issued by the Ministry of Commerce of the Republic of Indonesia through the State News, Indonesia positioned cryptocurrency as a commodity. This states that Indonesia allows cryptocurrency to circulate in the community. The Ministry of Trade of the Republic of Indonesia authorizes BAPPEBTI (Institute for Commodity Trading Supervision) similar to the SEC, to immediately issue rules relating to cryptocurrency trading. (if it has been published immediately updated).

Important note is that Indonesia refuses to use cryptocurrency as a payment transaction tool, based on law Number 7 of 2011 concerning Currency and Bank Indonesia rules Number 17/3/PBI/2015 concerning the Obligation to Use Rupiah in the Territory of the Republic of Indonesia.

While the rules for crowdfunding, Indonesia are regulated by the Financial Services Authority (OJK) through POJK.04/2018 regarding Equity Crowdfunding. Where all institutions that will conduct crowdfunding must have OJK permission and at a minimum the company must be a limited liability company (Perseroan Terbatas) or cooperative. This rule also limits the maximum value of the share offer of Rp. 10 billion (USD800 million).

Note: If there is a renewal, I will update it immediately.

But what exactly does this mean?

I guess they have clarified their position on bitcoin, i.e. it's not illegal to use or hold, but classifying as a commodity doesn't really help much in terms of determining what is legal to do with bitcoin, what regulation surrounds the use of bitcoin within Indonesia, etc. It's all very vague.

In fact, classifying something as a commodity would be no different to classifying it as a currency, if all the regulations are the same between the two. Perhaps there will be tax implications, but that is unknown from this report.

Drawbacks:
1. Bitcoins can't be used for purchasing goods and services.

Just because bitcoin isn't legal tender doesn't mean it can't be used to purchase goods and services. Who's to stop people from bartering fish for cows, for example, even though neither of these are legal tender and can be considered to be commodities? IMO, the same applies to bitcoin in this context.

[kaisa]

But what exactly does this mean?

I guess they have clarified their position on bitcoin, i.e. it's not illegal to use or hold, but classifying as a commodity doesn't really help much in terms of determining what is legal to do with bitcoin, what regulation surrounds the use of bitcoin within Indonesia, etc. It's all very vague.

In fact, classifying something as a commodity would be no different to classifying it as a currency, if all the regulations are the same between the two. Perhaps there will be tax implications, but that is unknown from this report.

Why do you think like that?

For now, our country has official rules for commodity trading and rules for crypto asset trading institutions by BAPPETI (SEC in Indonesian) http://bappebti.go.id/pbk/sk_kep_kepala_bappebti/detail/5205.
This is not just legality for bitcoin but for some crypto assets except ICO. The regulation also states that the institution must pass the ISO 27001 (Information Security Management System), ISO 27017 (cloud security) and ISO 27018 (cloud privacy) certificates. At least if you have to make an exchange company, you must have funds for collateral of 1.5 trillion rupiah or around $ 106,623,886. Funds are needed to avoid fictitious or scam companies.
In our country it is final that bitcoin and crypto assets are not used as a means of payment, even for payments between companies are prohibited from using dollars except payments between countries. So you cannot say that the rules in our country are "very vague", each country has its own policies for strengthening their physical money.