Majority of crypto exchange leadership should be comprised of citizens, say Indonesian regulators

Officials with Indonesia’s Commodity Futures Trading Regulatory Agency could implement a rule for two-thirds of directors and commissioners at crypto firms to be citizens.

Jerry Sambuaga, the deputy minister of Indonesia’s Ministry of Trade, has proposed a rule that would require the leadership at the country’s crypto exchanges to be more representative of its citizens. 

In a Tuesday parliamentary meeting that included Indonesian regulatory officials, a letter submitted by Sambuaga suggested several policy changes in response to the “interesting year for the development of physical trading of crypto assets” in the country. Among the proposed rules is a requirement for two-thirds of directors and commissioners at crypto firms to be “Indonesian citizens and domiciled in Indonesia.”

A Wednesday report from Bloomberg suggested that the proposed changes to the country’s crypto policy may have been influenced by the legal battle involving Terra co-founder Do Kwon. The South Korean national left the country for Singapore in April and his current whereabouts are unknown at the time of publication, despite officials issuing a warrant for his arrest and Interpol reportedly placing Kwon on its Red Notice list.

According to the report, Indonesia’s Commodity Futures Trading Regulatory Agency acting head Didid Noordiatmoko said the rule aimed to stop leadership at crypto firms “from fleeing the country if any problem arises.” In addition to the citizen rule, Sambuaga proposed crypto firms have a minimum capital requirement of 100 billion rupiah — roughly $6.7 million at the time of publication — and user funds be stored in third-party financial institutions or futures clearing houses.

Related: Indonesia plans to set up its crypto bourse by the end of 2022

With a population of more than 275 million people, roughly 11 million in Indonesia invested in crypto in 2021, according to Sambuaga. The country’s Commodity Futures Trading Regulatory Agency showed there were 25 registered crypto exchanges as of April 2022, including local branches of Zipmex and Upbit.