Indonesian President Joko Widodo Warns of Money Laundering via Crypto and NFTs

In a statement, the president acknowledged signs of approximately $8.6 billion (equivalent to 139 trillion IDR) worth of money laundering through cryptocurrencies in 2021, as revealed in the 2022 Crypto Crime Report published by Chainalysis.

“This global total of Rp 139 trillion is not just big, it’s tremendously big,” Widodo stated in his speech. “We need to act swiftly and remain competitive. Else, we risk falling further behind.”

In addition to cryptocurrencies and non-fungible tokens (NFTs), President Jokowi emphasized the importance of keeping an eye on other possible means for money laundering. These include virtual assets, marketplaces, digital currency, and artificial intelligence-facilitated transactions.

In response to the president’s instruction, Mahendra Siregar, head of the Financial Services Authority (OJK) Board of Commissioners, stated that they would handle crypto regulation oversight when this responsibility transfers to the OJK beginning next year.

“Starting soon, as part of the Anti-Money Laundering and Terror Financing Prevention Team, we’ll be able to keep an eye on such matters. This includes checking if their services overlap with those offered by other financial institutions,” Mahendra explained to reporters at a press conference on Wednesday.

Starting in January 2025, the responsibility for overseeing crypto assets in Indonesia will shift from the Commodity Futures Trading Regulatory Agency (Bappebti) to the Financial Services Authority (OJK), as outlined in Law Number 4 of 2023.

New president

The upcoming Indonesian government, led by President Prabowo Subianto and Vice President Gibran Rakabuming Raka after the February 2024 elections, have made it clear that they are in favor of cryptocurrencies based on their public statements.

During his election campaign, President Widdo’s son, Gibran, publicly stressed the importance of having blockchain and cryptocurrency specialists in Indonesia to boost the nation’s tech industry. Conversely, Prabowo and his National Campaign Deputy Chairman, Erwin Aksa, had earlier announced their plans to enhance crypto asset tax compliance if they were elected. With their official inauguration scheduled for October 20, 2024.

Editor’s note: Joko Widodo and Mahendra Siregar’s comments have been translated from Indonesian.