Cryptocurrencies, the digital coins that have no physical presence, became a hype following the first revelation of Bitcoin by Satoshi Nakamoto.
And in Indonesia, it's not immune to this trend.
But in the country known for its vast archipelago, cryptocurrencies are not considered a "legal" commodity.
However, despite being not considered legal tender, they can be traded as commodities on regulated exchanges.
Despite facing somewhat mixed reception from the government and public, in 2024, it's reported that cryptocurrency trading has soared 335% to reach $40 Billion in 2024. And this breaks record.
The Bank of Indonesia (BI) has expressed concerns about the volatility and risks of cryptocurrencies.
They have prohibited banks and payment systems from facilitating cryptocurrency transactions, meaning they can't be used for everyday purchases directly. Cryptocurrencies like Bitcoin, Ethereum, and others are not considered legal tender in Indonesia, and that the government has made it clear that the Indonesian Rupiah (IDR) remains the only official currency in the country.
However, the government has not made it illegal to own cryptocurrencies.
In Indonesia, cryptocurrencies can be legally used for investment purposes and can be traded.
To regulate cryptocurrency-based transactions, the Commodity Futures Trading Regulatory Agency (BAPPEBTI) oversees the trading of cryptocurrency assets as commodities.
With cryptocurrencies gaining traction among investors worldwide, Indonesians are also putting an increased interest in this blockchain-powered technology.
With the value of cryptocurrency trading in Indonesia surged by an astonishing 335% year-on-year in 2024, it reached an astonishing Rp 650.61 trillion ($40.2 billion), as announced by a senior official on Friday.
As of November 2024, the country had around 22.1 million registered cryptocurrency users, according to Tirta Karma Senjaya, head of BAPPEBTI
"These figures demonstrate growing public confidence in crypto asset trading in Indonesia," Tirta said during a press conference in South Tangerang, Banten.
The sharp rise in trading value, which increased from Rp 149.25 trillion ($9.2 billion) in 2023, reflects the growing number of cryptocurrency users and the surge in transaction volume.
Among the most actively traded cryptocurrencies in the country are Tether (USDT), Bitcoin (BTC), Dogecoin (DOGE), Pepe (PEPE), and XRP (XRP).
Here, Tirta has expressed optimism about future growth, forecasting that the number of cryptocurrency subscribers in Indonesia will soon reach 25 million.
BAPPEBTI, which operates under the Ministry of Trade, will transfer its oversight of cryptocurrency trading to the Financial Services Authority (OJK) beginning this year. Despite this shift, BAPPEBTI will continue to regulate commodity futures trading.
Tirta also reported that the value of commodity futures trading in Indonesia saw a 29.34% increase in 2024, reaching Rp 33,214 trillion ($2 trillion). Key multilateral futures contracts involve commodities such as tin, crude palm oil, gold, coffee, and cocoa.
It's worth noting that back in October 2023, BAPPEBTI launched the Indonesian Crude Palm Oil Exchange (ICDX) to provide a transparent and credible real-time price discovery mechanism.
"The ICDX membership is voluntary and limited to the domestic market. It facilitates both spot and futures transactions and is supported by 19 ports for crude palm oil deliveries," Tirta explained.
