Why Indonesia’s Upcoming Elections Could Shape the Future of its Thriving Crypto Industry
Indonesia has emerged as a significant player in the global crypto market, with the government showing a keen interest in fostering the sector’s growth. However, the upcoming general elections in February have raised concerns about the future of the country’s vibrant crypto industry, especially if there is a change in leadership.
The current administration, led by President Joko Widodo, has been proactive in promoting crypto adoption and innovation in Indonesia. They have even established the world’s first digital asset exchange. However, the stance of the next leaders may not be as favorable towards the crypto sector.
While not all leading candidates have expressed their views on crypto explicitly, their statements and actions provide insights into their potential approach to the industry.
Presidential and vice-presidential candidates Anies Baswedan and Muhaimin Iskandar, who represent the opposition, have remained relatively silent on crypto matters. However, their plans to overhaul existing policies suggest potential consequences for the crypto sector.
In 2022, Muhaimin proposed taxing crypto transactions as a means to boost state revenues. He also called for stricter regulation, including the supervision of the sector by the Financial Services Authority (OJK). Although OJK’s supervision of the crypto industry is scheduled for 2025, industry players hope it could result in reduced tax burdens for users and exchanges, as the current tax regime has been discouraging traders.
Another candidate pair consists of presidential candidate Ganjar Pranowo and his running mate Mahfud MD, a veteran politician and constitutional law expert. Although they have not addressed crypto during the campaign, Ganjar previously praised the creativity of non-fungible tokens (NFTs) when they were in the spotlight in 2022. However, he also emphasized the importance of tax compliance for the nation’s welfare.
Among the candidates, the most vocal supporter of crypto is Gibran Rakabuming Raka, the controversial running mate of current Defense Minister Prabowo Subianto. Being the son of President Widodo, Raka strongly advocates for digitization, particularly in the blockchain and crypto space. He has expressed his intention to prepare blockchain and crypto experts to enhance Indonesia’s tech sector.
On the other hand, Prabowo has emphasized the need for enhanced supervision of tax compliance among stock and crypto traders to combat tax evasion.
Considering their statements, Prabowo and Raka appear to be the candidates most likely to continue the current administration’s policies and attitudes towards crypto. This suggests the potential for a more crypto-friendly regulatory environment in Indonesia under their leadership.
With the general elections scheduled to begin on February 14, the outcome will be closely watched by the crypto industry, as it could shape the future trajectory of Indonesia’s vibrant crypto sector.