The Financial Services Authority of Indonesia (OJK) has announced new regulations for digital financial assets, including cryptos, as part of its transition to overseeing the sector.

This move follows the mandate outlined in Law Number 4 of 2023 on Financial Sector Development and Strengthening (P2SK Law).

This requires the transition of regulatory duties to OJK to be completed within 24 months of its enactment by 12 January 2025.

The OJK has outlined a three-phase transition plan to ensure a smooth transfer of responsibilities from the Commodity Futures Trading Regulatory Agency (CoFTRA/Bappebti).

The first phase focuses on adopting existing CoFTRA regulations, refined to align with international best practices in the financial services sector, ensuring a “soft landing” during the handover period to maintain stability and continuity.

Subsequent phases will strengthen the regulatory framework and support the sector’s long-term development and innovation.

The new regulation is designed to ensure that digital financial asset trading is conducted in an orderly, fair, transparent, and efficient manner.

It highlights the importance of strong governance, risk management, market integrity, and consumer protection.

Digital financial asset operators will be required to obtain licenses and submit both periodic and incidental reports.

The OJK urges consumers to understand the risks associated with digital financial assets and encourages operators to actively contribute to improving consumer literacy.

The regulation, stipulated on 10 December 2024, and promulgated on 12 December 2024, will take effect on 10 January 2025.

This marks a major step in Indonesia’s efforts to regulate the rapidly evolving digital financial asset sector.

Featured image credit: Edited from Freepik

The article first appeared on Fintech News Singapore