Bappebti Approves Zipmex, Indonesia’s First Official Crypto Exchange Provider

April 1, 2020 • Shannon Flynn

Despite
its widespread use and growing popularity, not every government has been keen
on accepting Bitcoin as legal currency. In Indonesia, the central bank banned
its use as currency towards the end of 2017. However, the Indonesian government
allowed the Futures trading of cryptocurrency soon after.

In
February, the Indonesian Commodity Futures Trading Regulatory
Agency (known as BAPPEBTI) required that cryptocurrency platforms wanting
to operate in the country would need to seek approval from the agency.

Earlier
this month, Zipmex became one of the first
crypto exchange providers
allowed to operate in the country.

With BAPPEBTI Approval, Zipmex Allowed to Operate in Indonesia

Since February of this year, following the agency’s ruling that bitcoin would be treated as an official commodity, all crypto exchanges wanting to operate in Indonesia must first register with BAPPEBTI.

The move allowed top companies to trade the asset on stock exchanges legally but also meant that cryptocurrency exchanges wanting to operate in Indonesia would need to first seek BAPPEBTI approval.

To
be granted approval by BAPPEBTI, a trading platform needs to prove that they
have controls in place to manage risk and secure transactions.  These
requirements are designed to give protection to traders from
fraudulent transactions.

The
trading platform, headquartered in Singapore, is one of the first to be allowed
to operate in Indonesia. BAPPEBTI has previously approved crypto exchange Tokocrypto, as well as
Indodax, Indonesia’s largest cryptocurrency firm.

Like other bitcoin platforms, Zipmex supports the trading of bitcoin between fiat currency and BTC. The Zipmex platform currently supports fiat-to-bitcoin trading in Australian, Singaporean and U.S. dollars, as well as Thai Baht. Approval from the agency will allow the company to trade bitcoin against the Indonesian fiat, Rupiah.

The Impact of Zipmex’s Expansion Into
Indonesia

The approval was the most recent in a string of recent successes for Zipmex in the Asia-Pacific Market. The trading platform had earlier received permission to operate in Australia. Zipmex is also one of the few exchanges granted a license to operate in Thailand.

The country’s SEC has so far granted only four of 20 platforms license to operate in the country and trade in Thai Baht. 

In
the past, Indonesia has lagged behind other major nations in terms of total
available cryptocurrency exchanges. In 2019, the country was home to the
lowest number
of cryptocurrency exchanges, both among G20 nations and
nations in the Asia-Pacific region, according to a report from Crystal.

Zipmex’s approval, however, may be a sign that this is beginning to change, and that major players in bitcoin will more aggressively target the Indonesian market.

Indonesia’s
digital economy is expected to more than triple over the next ten
years, according to a report from Google. At the same time, global Bitcoin
use is trending upwards.

It’s possible that more and more businesses in the Asia-Pacific market will start taking necessary steps to accept cryptocurrency as the bitcoin market continues to expand. More platforms may soon consider adopting the controls needed to gain approval for the Indonesian market.

However, the path forward may be challenging for all platforms to navigate. Traders wanting to operate in Indonesia will need to clear the regulatory hurdles that BAPPEBTI has currently in place, which is easier said than done.

In addition to the regulations on exchange security and risk management, platforms also need to be able to transfer one trillion Rupiah (approximately $71.3 million) in capital and keep 800 billion rupiah (around $54 million) in their accounts.

Some
traders have already complained that the capital requirements are too high.
While the amount may be reviewed and lowered in the future, it’s likely to
price smaller platforms out of the country for now.

Indonesia Allows New Bitcoin Platform

Despite
Bitcoin’s growing popularity, not every country has been quick to allow its use
as currency, or to support bitcoin-to-fiat trading. Indonesia, which has
traditionally been restrictive with regards to the use of Bitcoin, has
allowed  Zipmex to act as one of the country’s few cryptocurrency
exchanges. 

While
Indonesia hasn’t been a significant bitcoin market in the past and had one of
the lowest numbers of bitcoin exchanges in 2019, Zipmex’s approval could be a
sign that this is changing. Other platforms wanting to trade in the country,
however, will face steep barriers to approval from BAPPEBTI.

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