Indonesia's cryptocurrency landscape is undergoing a historic transformation. With the enactment of Law No. 4 of 2023 and the formal transfer of regulatory authority from BAPPEBTI to the Financial Services Authority (OJK) completed on January 10, 2025, the country has embarked on a new era of digital asset regulation that promises greater legal certainty, enhanced consumer protection, and expanded opportunities for blockchain innovation.

As the world's third-largest crypto market by adoption, Indonesia's regulatory evolution carries significant implications not only for domestic market participants but for the broader Southeast Asian digital asset ecosystem. The shift from treating cryptocurrencies as mere commodities to recognizing them as "Digital Financial Assets" under OJK's sophisticated three-phase regulatory roadmap represents one of the most comprehensive crypto regulatory frameworks in the region.

In this comprehensive Q&A with Al Kindi, a legal expert specializing in the intersection of law, technology, and cryptocurrency, we explore the current state of Indonesia's crypto regulatory development, examine the challenges and opportunities facing regulators and market participants, and provide insights into what the next 2-3 years may hold for businesses, legal practitioners, and investors navigating this rapidly evolving landscape. From understanding the new licensing requirements under the PAKD framework to analyzing how Indonesia's approach compares to other Southeast Asian markets like Singapore, this discussion offers essential guidance for anyone seeking to understand or operate within Indonesia's transformed crypto regulatory environment.

Whether you're a crypto exchange seeking compliance clarity, a blockchain startup exploring the regulatory sandbox, or a legal practitioner advising clients on digital asset matters, this Q&A provides the practical insights needed to successfully navigate Indonesia's new crypto regulatory reality.

Question 1: Indonesia's Crypto Regulatory Development: You mentioned that Indonesian regulators are still building comprehensive crypto regulations. What's the current state of this regulatory development process, and what key areas are regulators prioritizing as they work toward a complete framework?

The regulations of crypto in Indonesia has taken a big step forward with the enactment of "Law No. 4 of 2023". One of the key changes is the shift in regulatory authority from Commodity Futures Trading Regulatory (“BAPPEBTI”) to Financial Service Authority ("OJK"). And was formally completed in January 10, 2025.

As the OJK is now in charges, it has released a roadmap that divided into 3 phases. current state is at the phase 1: starting with strengthening regulatory and supervisory foundations. This phase began with the issuance of "OJK Regulation No. 27 of 2024". Since then, OJK  has made significant progress in developing and strenghtening of crypto sector. And one of the key area is the license from OJK for ("CFX") which is the first crypto bourse in Indonesia which operates under supervision of OJK.

CFX holds the authority to determine which crypto are eligible for listing and trading in Indonesia. As a results, CFX member are strictly prohibitted to listing any crypto that have not been approved. This is one of key regulatory mechanism from OJK to ensure legal certainity and to provide a consumer protection.

CFX acts as a centralized crypto exchange infrastructure that supervised their member which is a centralized exchange (CEX) that has obtained a Digital Financial Asset Trading ("PAKD") license from OJK to provide a trading platform in Indonesia. Holding a this license reflects a CEX’s commitment to regulatory compliance, particularly in areas such as consumer protection and AML/CFT.

Currently, several major Indonesian CEXs including Indodax, TokoCrypto, Pintu, Triv, Stockbit, Pluang and Ajaib, have obtained a PAKD license from OJK,

Question 2: Regulatory Challenges & Opportunities: What are the main challenges Indonesian regulators face in developing crypto legislation, and how do these compare to regulatory approaches you've observed in other Southeast Asian markets? Where do you see the biggest opportunities for innovation within the emerging framework?

Indonesia ranks third globally based on Global Crypto Adoption Index, indicating that high level of crypto adoption across the country. This rapid griwth present a significant challenges for OJK as a regulator. As they must continuously adapt the legal and regulatory framework to remain relevant, flexible, and responsive to emerging technologies.

One of the key challenges is balancing innovation with consumer protection and systemic stability, particularly for blockchain applications with financial implications such as tokenized assets, lending-borrowing, and staking protocol. These projects are required to obtain approval from OJK and enter the Regulatory Sandbox, where they are evaluated for risk management, compliance, and AML/CFT measures. While this system provides necessary safeguards, it can also be slow and difficult to scale.

By comparison, Singapore takes a stricter but more flexible approach through its Monetary Authority of Singapore ("MAS"). Their model balances strong compliance requirements with a supportive sandbox system and solid regulatory structure. MAS offers three options: the Regulatory Sandbox, Sandbox Express, and Sandbox Plus, each tailored to different levels of innovation, risk and time sensitivity. In contrast, Indonesia’s sandbox is more cautious, showing a slower and more careful approach to financial innovation.

Looking ahead, non-financial blockchain use cases such as in supply chain management, digital identity, and document verification, offer promising opportunities for innovation in Indonesia. As regulatory clarity improves and the government continues to recognize blockchain as a national strategic technology ("NST"), developers and startups will be better equipped to create impactful solutions. Rather than competing in finance services, Indonesia’s strength may lie in leveraging blockchain to address local challenges and build a robust ecosystem that can scale across Southeast Asia.

Question 3: Future Outlook for Indonesian Crypto Law: Based on current regulatory trends and discussions, what do you anticipate the Indonesian crypto landscape will look like in the next 2-3 years? What should businesses and legal practitioners be preparing for as these regulations take shape?

In the next few years, Indonesian crypto landscape is expected to undergo a significant transformation marked by regulatory consolidation, institutional oversight, stronger legal certainty, and wider public adoption. Following the enactment of "Law No. 4 of 2023". This shift not only marks the transfer of regulatory authority from Bappebti to OJK, but also reflects a broader transformation in the legal classification of crypto from being treated merely as "Commodities" to being recognized as "Digital Financial Assets". This new approach emphasized on consumer protection, and innovation enablement.

Compliance for the new regulations requires businesses operating in the financial sector using blockhain technology to prepare themselves to operate under the stricter supervision of OJK. This includes the obligation to obtain a license, ensure transparency, pass fit and proper test, and implement of AML/CTL.

While for legal practitioners, understanding how law intersect with emerging technologies, especially in blockchain technology is becoming important. Building familiarity with blockchain related issues such as RWA, DeFi, NFTs, and ICOs will help them to provide accurate and relevant legal advice to their clients operating in the blockchain and crypto related sectors.