In one of the latest regulatory moves, the Indonesian Commodity Futures Trading Regulatory Agency, commonly known as Bappebti, has announced an extension for Indonesian crypto exchanges to meet the requirements for acquiring a Physical Crypto Asset Traders (PFAK) license.
This decision, made under Bappebti Regulation No. 9 of 2024, grants crypto exchanges until the last week of November 2024 to comply with the updated regulatory standards.
Indonesia Crypto Exchange: The License Everyone is Waiting For?
Bappebti’s Regulation No. 9 of 2024 marks the third amendment to its rules concerning the organization of physical market trading for crypto assets, originally set out in 2021.
It outlines the transition from registered crypto exchanges’ (CPFAK) current provisional status to fully licensed PFAK status.
The changes, including the extension, allow prospective crypto exchanges more time to complete the required obligations, such as becoming members of the Futures Exchange and the Crypto Futures Clearing House.
INDODAX, one of Indonesia’s largest crypto exchanges, welcomed the extension. Its CEO, Oscar Darmawan, mentioned in the statement that the additional time would allow exchanges to meet the requirements.
“We warmly welcome this decision, as it provides space for more exchangers to fulfill their obligations in accordance with applicable regulations.”
Darmawan also emphasized that INDODAX had already completed significant parts of the process, including obtaining key approvals for exchange and clearinghouse memberships, and was now waiting for Bappebti’s final validation.
The new regulation gives crypto exchanges extra time and broadens the scope of participation in the crypto market. Previously, only individuals were permitted to be crypto asset customers.
The new guidelines allow legal entities and business enterprises to trade crypto assets. This change is expected to encourage more institutional involvement in Indonesia’s growing digital asset market.
Regulatory Cooperation and Impact
The regulation also highlights the requirements for Know Your Transaction (KYT) standards and cooperation agreements with the Indonesian Directorate General of Population and Civil Registration (Ditjen Dukcapil).
These measures ensure that crypto exchanges operate transparently and meet legal requirements, protecting institutional and individual investors.
According to Aldison, Head of Bappebti’s Bureau of Legislation and Enforcement, crypto exchanges must sign agreements with Ditjen Dukcapil as part of their licensing process.
In addition, all CPFAKs must become members of the Crypto Asset Futures Exchange and the Crypto Asset Clearing House within seven working days of obtaining their registration certificate.
“This must be fulfilled no later than seven working days since this Perba is stipulated.”
If not, their registration may be revoked.
Notably, Binance’s subsidiary, Tokocrypto, has recently secured a Physical Crypto Asset Trader (PFAK) license from Indonesia’s commodity regulator, Bappebti.
Binance subsidiary Tokocrypto announced that it has obtained a physical crypto asset dealer license issued by Indonesia's Commodity Futures Trading Regulatory Authority, becoming the third exchange in Indonesia to obtain a PFAK license. Tokocrypto's user base has exceeded 4.5…
— Wu Blockchain (@WuBlockchain) September 9, 2024
With this license, Tokocrypto becomes the third exchange in the country to receive such certification. Its user base has surpassed 4.5 million, and trading volume has surged 170% since 2023.
Following Binance’s acquisition of Tokocrypto in December 2022, the company now holds a commanding 43% share of Indonesia’s crypto market.
Also, Binance’s Financial Intelligence Unit (FIU) and Tokocrypto collaborated with Indonesia’s Criminal Investigation Agency, Bareskrim, to crack down on crypto fraud.
This joint effort led to the arrest of multiple suspects and the seizure of approximately $200,000 in fraudulent funds.
The investigation uncovered a fraudulent crypto trading website involved in a “pig butchering scam,” where fraudsters manipulate victims into making substantial investments under the guise of legitimate trading.
For Indodax, their push for proper regulation came after they suffered a significant security breach on September 11, resulting in the theft of approximately $22 million in digital assets.
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