After being mandated by Law No. 4 of 2023 a few years ago, the Indonesian Financial Services Authority (Otoritas Jasa Keuangan / “OJK”) has started the transition period of the crypto-assets supervision (which was previously supervised by the Commodity Futures Trading Regulatory Agency (“BAPPEBTI”). On 10 December 2024, the OJK issued Financial Service Authority Regulation No. 27 of 2024 on the Implementation of Trading in Digital Financial Assets Including Crypto Assets (“DFA”) (“POJK No. 27/2024”), which will become effective starting on 10 January 2025. At a glance, POJK No. 27/2024 regulates broader products than the crypto-assets as it used the term of digital financial asset (and asset-crypto is one of them).
This article aims to highlight several key terms in the Digital Financial Asset Trading Industry with the implementation of POJK No. 27/2024.
- Scope of Digital Financial Assets
POJK No. 27/2024 defines digital financial assets as those issued, stored, transferred, or traded using a distributed ledger technology. They must not be electronically registered financial assets, sourced from or utilized in illegal activities, and must meet other criteria set by the OJK.
Furthermore, POJK No. 27/2024 also clearly stipulates that digital financial asset, also encompasses crypto assets, which is defined as:
“a digital representation of a value can be stored and transferred using technology which allows the use of ledgers distributed such as blockchain to verify transactions and ensure security and validity stored information, is not guaranteed by a central authority such as a central bank, but issued by private parties, may be transacted, stored, and transferred or transferred electronically, and may be in the form of a digital coin, token, or other asset representation that include backed crypto-assets and unbacked crypto assets”.
Specifically for crypto assets, POJK No. 27/2024 also set out the criterion of crypto assets which may be traded in the Digital Financial Asset Market:
- Act as a representation of a primary digital value;
- Utilizing a distributed ledger which may be accessed by the public;
- Has utility and/or supported by an asset;
- May be traced or does not have features to disguise or hide ownership and transaction data; and
- an assessment has been carried out using a method stipulated in the Exchange rules and regulations.
- Type of organizers in the Crypto Trading Industry
Similar to the BAPPEBTI’s regulation concerning crypto-asset trading, POJK No. 27/2024 also classifies several organizer / business entities in the DFA Industry:
| Organizer (entities) | Description |
| Exchanges | Exchanges are business entities which organize and provide systems and/or means to facilitate the activities relating to Digital Financial Assets including to Crypto Assets and/or provide trade reporting of Digital Financial Assets. |
| Guarantee Clearing and Settlement Organizer | Clearing and Settlement Organizer are business entities which provide settlement services of trade transactions of Digital Financial Assets and settlement guarantee of Digital Financial Assets trade transactions. |
| Storage Managers of Digital Financial Assets | Storage managers of Digital Financial Assets including Crypto Assets are business entities which have acquired business license from the OJK to manage the storage location of Digital Financial Assets to conduct storage, maintenance, supervision, and/or delivery of Digital Financial Assets. |
| Traders | Traders of Digital Financial Assets are business entities which conducts trade, on behalf of itself and/or to facilitate consumers. |
- Business Licensing
POJK No.27/2024 sets out the business licensing requirements for Digital Asset Trading Organizers to conduct its business activities. In essence, POJK 27/2024 obliges Digital Asset Trading Organizers to fulfil the business licensing requirements by acquiring them from the OJK.
The application of the license must be conducted in writing by the member of the board of directors of a prospective Digital Financial Asset Trading Organizer to the OJK by fulfilling the requirements set out under the appendix of POJK No. 27/2024.
As a transitional provision, Article 130 of POJK No. 27/2024 stipulates that all licenses, product registration approvals, instruments, and/or activities, as well as all decrees and/or determination relating to Crypto Asset which was issued by the BAPPEBTI prior to the effectiveness of POJK No. 27/2024 is still considered effective. Furthermore, all application of licenses, approval instruments, and/or activities which is waiting approval from the BAPPEBTI will be processed by the OJK in accordance with the terms set out under POJK No. 27/2024.
- Capital, Equity Requirements, and Limitations
| No. | Organizer (entity) | Minimum Capital Requirement (Issued and Paid-Up Capital) | Reference (POJK No. 27/2024) | Foreign Ownership Restrictions | Reference (POJK No. 27/2024) |
| Exchanges | IDR 1 trillion | Article 19 (1) Jo. Article 19 (2) | 40% | Article 23 | |
| Clearing and Settlement Organizers | IDR 500 billion | Article 28 (1) Jo. Article 28 (2) | 40% | Article 31 | |
| Storage Managers of Digital Financial Assets | IDR 250 billion | Article 36 (1) Jo. Article 36 (2) | – | Article 38 | |
| Traders | IDR 100 billion | Article 45 (1) Jo. Article 45 (2) | – | Article 48 |
These regulations are pretty much similar to the one regulated for crypto-assets trading under the BAPPEBTI’s regulations – therefore, there is no surprise intorduced by the OJK through the issuance of POJK No. 27/2024.
- Assessment of Principal Parties
In addition to the provisions relating to the obligation of the organizers, POJK No. 27/2024 also set out the obligations of “principal parties”, which includes (i) controlling shareholders, (ii) member of the board of directors, and (iii) member of the board of commissioners.
Before acting as a principal party, these parties must obtain approval from the OJK through a fit and proper test. The OJK will establish further provisions
.
Any Organizer which fails to fulfil the obligation to acquire an OJK approval for its principle parties may be subject to administrative sanctions in the form of (a) written reprimand, (b) temporary suspension in part or in whole of the activities including conducting cooperations, (c) dismissal and/or change of management, (d) inclusion of a principal party in the black list in the financial sector, and/or (e) revocation of business license.
Conclusion
POJK No. 27/2024, effective January 10, 2025, will regulate the Digital Financial Asset Industry in Indonesia, including crypto assets. It provides guidelines and references for industry organizers, including business entities and principal parties’ obligations and limitations.
Notably, POJK No. 27/2024 shifts the supervision authority of crypto trading from BAPPEBTI to OJK. The requirements for crypto-asset trading are similar to those previously issued by BAPPEBTI, ensuring a smooth transition.
However, BAPPEBTI issued Circular Letter No. 374/BAPPEBTI/SE/12/2024 on December 17, 2024, stating a government regulation will be issued to govern the transfer authority from BAPPEBTI to OJK. The transition will not commence until the government regulation is issued. It is uncertain if the government regulation will be issued before POJK No. 27/2024’s effective date and if the transition can occur even if the government regulation has not been issued.
For Further Information, Please Contact:
MetaLAW, Legal Consultant, Jakarta, Indonesia
general@metalaw.id
- Peraturan OJK No. 27 Tahun 2024 tentang Penyelenggaraan Perdagangan Aset Keuangan Digital Termasuk Aset Kripto Article 140 POJK No. 27/2024
- Article 4 POJK No. 27/2024
- Article 1 (7) (9) (11) (12) POJK No. 27/2024
- Article 55 (1) POJK No. 27/2024
- Article 60 POJK No. 27/2024
- Article 60 (2) (7) POJK No. 27/2024
- Under Indonesian Law, management (pengurus) is commonly used as reference to the Board of Directors and Board of Commissioners of a Company.
- Article 60 (5) POJK No. 27/2024
