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Blockchain Startup Installs Crypto Point-of-Sale Devices in Indonesia Despite Regulations

Blockchain startup Pundi X has begun rolling out its cryptocurrency point-of-sales (POS) devices in Indonesia, betting that the central bank will discard its current anti-cryptocurrency stance within three years, the South China Morning Post reported June 4.

A POS terminal is an electronic device used to process card or electronic payments at sales outlets. The idea behind the startup’s devices is to make digital currencies a medium of daily exchange, letting people use virtual currencies to buy necessities like food products in retail stores, cafes and shopping malls where merchants have installed the POS devices.

While cryptocurrency is not legally recognized as a payment instrument in Indonesia, the company’s chief legal counsel David Ben Kay said that the deployment of the POS devices would be completed regardless of regulatory developments. Kay said this is because the device’s cryptocurrency function is not the default option, and it supports payment methods that are compliant with current regulations. He explained:

“The functionality for dealing in cryptocurrency is not automatic, it has to be activated when it is legally permissible in any jurisdiction that the POS is being deployed by the retail store owners.”

Kay suggested that it is only a matter of time before Asian authorities soften their position toward digital currencies. Pundi X has decided to debut its product and services in Indonesia because of the large population and largely cash-based economy.

Pundi X has reportedly said that it received pre-orders for the POS devices from  Indonesia, South Korea, Japan, Singapore and Switzerland. The company plans to install up to 100,000 POS devices to build its blockchain-based payment network in Southeast Asia by 2021. This ostensibly would enable the 80 percent of the Indonesian population that does not have access to banking services to start purchasing and selling cryptocurrencies.

Today, the Indonesian Trade Ministry’s Futures Exchange Supervisory Board (Bappebti) signed a decree making cryptocurrency a commodity legally tradable on a stock exchange. Dharma Yoga, a Bappebti official, noted that the Indonesian government will soon release legislation on regulating currency exchange companies, taxation, and combating money laundering and terrorism financing.

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Reports: Crypto Now Considered a Commodity on Indonesia’s Stock Exchange

The Indonesian Trade Ministry’s Futures Exchange Supervisory Board (Bappebti) has signed a decree to make cryptocurrency a commodity legally tradable on a stock exchange, local news outlet The Jakarta Post reports today, June 4.

According to Dharma Yoga, head of Bappebti market supervision and development bureau, the Future Exchange Supervisory Board decided to allow crypto to trade as a commodity as a result of a four month study into cryptocurrencies.

Dharma also noted that the Indonesian government will soon release corresponding legislation on regulating currency exchange companies, taxation, and combating money laundering and terrorism financing.

Bappebti, which will work with crypto exchanges on regulation by asking them to advance reports on product specification and trading procedures, will also collaborate with BI and a variety of government financial, tax, and police agencies.

On the other hand, the country’s central bank, Bank Indonesia (BI), does not recognize cryptocurrencies as payment instruments, and its lack of crypto recognition led to two Indonesian crypto exchanges shutting down last fall. More recently, in mid-January Bank Indonesia had also issued a warning to all citizens against using cryptocurrencies, citing their high risk.

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Cryptocurrencies Legalized as Futures Trading Commodities by Indonesian Regulator

Bappebti, the Indonesian Trade Ministry’s Futures Exchange Supervisory Boards has legalized cryptocurrencies as commodities in the country. Local media sources announced the landmark decision on June 3, 2018. Bappebti’s directive comes even as the country’s central bank does not recognize cryptos as means of payments.

Cryptocurrencies are Now Commodities in Indonesia

According to The Jakarta Post, Bappebti’s decision means that people can trade cryptocurrencies on the country’s futures market. Speaking to local media sources about the decision, Dharma Yoga, the head of Bappebti market supervision and development bureau, said that:

The Bappebti head has signed a decree to make cryptocurrency a commodity that could be traded at the bourse.

According to Yoga, the Bappebti board carried out an extensive four-month review before deciding to classify cryptocurrencies as commodities. Yoga also said that:

The government will soon issue a supporting regulation that will rule on several issues including currency exchange companies, taxation, and prevention of money laundering and terrorist financing.

Creating the Proper Regulatory Framework

Concerning the regulatory steps to take in the aftermath of the decision, Yoga said all necessary stakeholders need to work together. According to him, financial regulators like the Taxation Directorate General, the Financial Services Authority (OJK), and the Financial Transaction Reports and Analysis Center (PPATK) need to collaborate to create the proper regulatory framework for cryptocurrency commodity trading. Also, Yoga called on the central bank and the police counterterrorism squad to be part of the process.

According to Yoga:

The government will soon issue a supporting regulation that will rule on several issues including currency exchange companies, taxation, and prevention of money laundering and terrorism financing.

The quest to create the perfect regulatory environment for crypto commodities trading will not be complete without the active participation of the country’s digital currency community. Thus, Yoga said Bappebti is reaching out to Indodax, and several other stakeholders to submit proposals for trading procedures and product specifications. Some of the required information includes the type of cryptos and the tick size of trading instruments. Other pertinent information includes the mechanism for dispute settlement as well as the prescribed trading hours.

Central Bank Still Against Cryptocurrencies

All eyes are on the Indonesian central bank to see how it adjusts its stance on digital currencies. The apex bank earlier classified cryptos as not being a legal exchange medium. Thus, there is a prohibition on crypto payments in the country. According to the bank, cryptos are a veritable means for money laundering and terrorist funding.

There have been calls for the bank to look into creating a national crypto for the country. The country’s former finance minister, Chatib Basri, called on the bank to reconsider its stance on digital currencies.

Will this latest development force the country’s central bank to rethink its prohibition on cryptocurrency payments? Do you think this decision will turn Indonesia into a cryptocurrency trading hub in the Asian theater? Keep the conversation going in the comment section below.

Images courtesy of Pxhere and Pixabay.

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Indonesian Regulator Gives Green Light for Crypto Futures Trading

Indonesia’s Futures Exchange Supervisory Board (Bappebti), a commodities market regulator under the country’s Ministry of Trade, has reportedly ruled that cryptocurrencies are commodities that can be traded on the country’s futures exchange.

According to a Jarkata Post report on Monday, the agency’s market supervision chief, Dharma Yoga, has confirmed the decision and said the ruling came after a four-month study period that examined the issue.

According to Yoga, the agency has now signed a decree to formalize the decision, potentially clearing the way for the launch of a bitcoin futures product in Indonesia.

Meanwhile, other regulations around cryptocurrency exchanges and related taxation in the country will also be revealed by the country’s central bank and its taxation agency, Yoga said.

The central bank, Bank Indonesia, suggested late last year that it would prohibit bitcoin payments in the country, and subsequently stated it does not recognize the cryptocurrency as a legal payment method. However, it did not mention cryptocurrency exchanges at the time.

Yoga further indicated that, in order to prepare a comprehensive regulatory framework, the agency is now requesting domestic cryptocurrency exchanges to submit regulatory proposals.

Indonesian rupiah via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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Tron (TRX) Making Strides With New Listing In Indonesian Crypto-Market

Justin Sun and the Tron (TRX) Foundation are continually relentless with respect to getting new listings for TRX in the crypto-market. Less than 2 hours ago, Justin Sun announced via twitter that TRX will now be available for trading on the Indonesian exchange, Indodax, beginning June 5th.

In the tweet, Justin had this to say:

#TRON $TRX #TRX will be available to trade with $Rupiah at @IndodaxOfficial, deposit starts from June 4th 2018 at 8:00 WIB, trading starts from June 5th 2018 at 15:00 WIB

The TRON community has been continually pleased with the progress of the project and token that the responses to the above tweet, openly showed their admiration for Justin Sun. One user by the name of Adam Samaeli had this to say about the progress:

Everybody please give Justin and his hardworking team a round of applause. Great work!!!!

Other twitter users also replied to the tweet and were even more emphatic about a Moon Landing for the token which will migrate to the MainNet beginning the 21st of June.

A second user had this to say:

Moon soon..Indodax marke[t] are crazy, look [at] STQ. [It] pump[ed] to 1 Billion IDR [in] only 24 Hr and make STQ [gain] 200%.

The Indodax exchange also announced the same about TRX being listed on its platform. The team were extremely particular as to why they chose TRX on top of giving instructions on when to start deposits on the platform:

On Monday, 4 June 2018 at 08.00 WIB, you can deposit your TRX to your account in Indodax and on Tuesday, 5 June 2018 at 15.00 WIB you can trade TRX with Rupiah in Indodax.

Tron was chosen because this token is in the top 50 of CoinMarketCap (ranked 10th when this article was written), so it doesn’t need to go through community coin voting process. This is consistent with our mission to always add quality digital assets at Indodax.com.

Current market analysis indicate that TRX is responding positively to the general uptrend in the crypto-market. The token is currently trading at $0.062 and up 2.24% in 24 hours at the moment of writing this. Many HODLers and fans were afraid the token would not recover from the slight drop in value during the MainNet launch. Things seem to be looking up for the token, and later coin, that is the centerpiece of Justin’s vision of decentralizing the web.

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Sumatra to Pilot Blockchain App for 'Decentralised Decision-Making'

An Australian startup is launching a blockchain application in Indonesia that could eventually allow citizens to vote in elections.

The pilot project from Horizon State is expected to launch on the island of Sumatra in July, with the roll-out expected to continue till December, the platform’s co-founder, Nimo Naamani, told CoinDesk via email.

The blockchain-based platform will be made available to locals via a mobile app and is initially aimed to help provide “decentralised decision making and community engagement,” according to Naamani.

Ultimately, the startup hopes the app could extend to voting to counter fraud and address local electoral challenges, as well as other services.

Naamani said:

“Through the platform, we can provide communities with tools to increase engagement and discussions. Through our partners, we can provide the constituency with additional benefits such as access to financial services on a micro-level – something that’s not so easy with existing banking infrastructure.”

Should the Sumatra pilot prove successful, Horizon State is hoping to expand the project across the country.

“Once this is done, I believe additional expansions into more provinces and communities will happen throughout 2019,” he said.

While the Indonesian government is not involved in the effort as yet, he noted that the company would be in a position to approach the authorities over a variety of use cases, including elections, after the Sumatra roll-out.

“We’re seeing a surge of interest from organisations that want to use blockchain-based community engagement to drive progress forward,” Naamani said.

For the pilot, Horizon State will be partnering with cryptocurrency finance startup MCV-CAP, as well as another partner to be announced in the next few weeks, according to the co-founder.

The news arrives as Indonesia is more widely eyeing blockchain technology.

According to Reuters, the country’s Financial Services Authority, which regulates the finance sector, has set up a team assigned to study the technology and its potential benefits.

Additionally, Finance Minister Sri Mulyani Indrawat told the news source that her department was eyeing blockchain for various use cases including subsidies and micro-loans.

Sumatran town image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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Major South Korean Crypto Exchange Coinone To Launch In Indonesia

South Korea’s third largest cryptocurrency exchange, Coinone, has announced plans to launch an exchange in Indonesia, according to a press release published on its site Monday, April 16.

As stated in the Coinone’s press release, the new Indonesian branch opened for pre-registration April 16, with an official launch set for June. According to Finance Magnates, the exchange will initially support six cryptocurrencies: Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), Ethereum Classic (ETC), Litecoin (LTC) and Quantum (QTUM).

Users based outside of Indonesia will be able to use the platform after the pre-registration period, but will need to go through a separate KYC verification process, the exchange stated.

Coinone is currently ranked number 27 among crypto exchanges globally, with a 24-hour trading volume of $49 mln to press time. Finance Magnates reports that, according to the exchange, its overseas expansion makes it the “first among the top cryptocurrency exchanges in Korea to enter the global market.” Coinone explains that it chose Indonesia due to the country being “highly regarded for its potential growth in the Fintech industry.”

The company’s evaluation notwithstanding, Indonesia has a relatively tough crypto-regulatory climate. As of Jan. 2018, its central bank has adopted a harsh stance, warning citizens against selling, buying or trading cryptocurrency. Earlier, in October of last year, the bank reiterated that it does not recognize Bitcoin as a legal means of payment, causing two domestic crypto exchanges to shut down voluntarily.

On home territory, Seoul continues to actively regulate the country’s booming cryptocurrency sphere. On April 9, Cointelegraph reported that South Korea’s Financial Services Commission’s (FSC) has inspected three domestic banks serving crypto exchanges for compliance with anti-anonymity regulations that were introduced in January. Nonghyup Bank, Coinone’s service partner, is currently under scrutiny as part of these measures.

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Fintech Startup Report Concludes Bitcoin Is ‘Generally Permissible’ Under Sharia Law

Blossom Finance, a fintech startup based in Indonesia, has released a report by their internal Sharia advisor that concludes that Bitcoin (BTC) is “generally permissible” under Sharia law, according to a press release published Thursday, April 12.

In late February, Cointelegraph also published a story on whether Bitcoin was halal, including information from Blossom Finance CEO and Founder Matthew J. Martin (also interviewed by CT in 2015), who told CT that not only is Bitcoin halal, it may be even more halal than fiat currencies due to it being based on Proof-of-Work, rather than on debt.

Blossom’s report, dated April 5, is titled, “Is Bitcoin Halal or Haram: A Sharia Analysis,” and written by Muhammad Abu Bakar, a certified Mufti (Muslim legal expert) as well as Haziz, having successfully memorized the Qu’ran in 2002.

Earlier today, Bitcoin’s price rose by more than $1,000 in 30 minutes, a jump that could be attributed to an increase in Muslim crypto traders since the report’s release today.

Abu Bakar summarizes all of the various definition in Islam for both property (mal) and currency as a way of deciding whether or not cryptocurrencies like Bitcoin fall under the halal (permissible) category, or the haram (prohibited), as well as listing the various Islamic organizations globally that have issued official stances about Bitcoin’s role in Islam.

Abu Bakar uses these two definitions in order to refute the reasons why some organizations, governments, and people (including the Grand Mufti of Egypt, the Turkish Government, the Fatwa Center of Palestine, and scholar Shaykh Haitam) have said that cryptocurrency is haram.

An analysis of the common reasons for this “prohibited” categorization shows that crypto not being legal tender is a main point in labeling Bitcoin haram. However, Abu Bakar writes that since crypto is widely accepted, its legality or illegality as tender does not disclude it from being money; another reason is that crypto is not controlled by a central authority – Abu Bakar writes that crypto technology, like Blockchain, can be more secure than the current systems in place;

Abu Bakar concludes with a slight warning, noting that while he considers cryptocurrencies to be halal in most cases (excluding jurisdictions where crypto is banned), crypto traders should not purchase cryptocurrencies for investment purposes:

“Rather, it is advisable to utilize cryptocurrency networks as a payment system in the cases where cryptocurrency network offer specific benefits and advantages over conventional systems.”

Abu Bakar also warns the Muslim community to stay aware of Initial Coin Offering (ICO) scams that promise fixed returns on a “halal investment.”

NOORCOIN, a cryptocurrency certified with a Sharia Certificate from the World Sharia Advisory Committee, according to its March 19 press release, markets itself as the “world’s first sharia-compliant utility token.” NOORCOIN was not designed specifically for Muslims, but the press release is clearly targeted, noting that its Sharia compliance will allow the world’s Muslims to enter the crypto sphere.

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Omise Signs Agreement With Major South Korean Banking Affiliate In Win For Adoption

Thailand’s Omise and OmiseGO (OMG) have signed a Memorandum of Understanding (MoU) with major South Korean credit card business and technical company ShinhanCard, an affiliate of Shinhan Financial Group, as part of a move towards fintech innovation and Blockchain adoption throughout Asia, according to Omise’s press release published Thursday, April 5.

Omise is a payment solution platform that has operational hubs in Thailand, Singapore, Japan, and Indonesia; OmiseGO is its decentralized scaling solution network for Ethereum (ETH). OmiseGO raised $25 mln in an Initial Coin Offering (ICO) last August to support the creation of their platform.

Cointelegraph contributor Joseph Young tweeted April 5 about the MoU, nothing that Shinhan is South Korea’s second largest bank, and calling the move “huge” news for OmiseGo and “the entire Ethereum community:”

According to the press release, the MoU will bring Omise further into Southeast Asia and Japan, as well as help to “advance ShinhanCard’s digital offerings across its portfolio of payment services and mobile application” with the use of OmiseGo’s publicly available server and SDK wallets.

Jun Hasegawa, the CEO and founder of Omise and OmiseGO, said in the press release,

“Omise and OmiseGO are working to revolutionize the way digital value moves globally, with an end goal of creating a platform that facilitates a decentralized economy. The OMG platform, using the Plasma architecture, is being built as a public network that is powered by Ethereum. The first phase of the [OmiseGO] wallet SDK was recently release [sic] and is available for anyone to use. We want to make it easy for those who need online asset exchange as part of their business to connect seamlessly to the OMG Network.”

This week has already seen two wins for Blockchain adoption in Asia, with the launch of the “Blockchain Challenge” to promote innovation in businesses by Singapore’s media authority, as well as Japanese chat app Line Plus’s opening of a Blockchain affiliate in South Korea.

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Bitcoin Under Increasing Scrutiny on Island of Bali

Bitcoin is under heavy surveillance on Bali, an island in the Indonesian archipelago, according to local reports. Central Bank officials are seeking to crack down on the use of the cryptocurrency anywhere in the nation. Causa Iman Karana, head of Bank Indonesia’s representative office in Bali said:

“We found out from some postings on social media that Bali appeared to have become a haven for Bitcoin transactions. The next step is we will ban them as mandated by the law. We ask them not to use it anymore. Along with the Directorate of Special Crime Investigation unit, we will enforce the rule that all transactions in Indonesia must use rupiah.”

The country had previously been reported as having significant local adoption of Bitcoin usage, but recent reports indicate that the government is trying to curtail the use of digital currencies. The risk of money laundering and criminal activity has led to the increased scrutiny.

The harsh rhetoric against Bitcoin and other cryptocurrencies falls more in line with the Chinese and potential South Korean bans than the more lenient Australian position.