Indonesia

Indonesian government looks to NFTs to preserve cultural heritage

The Deputy of Indonesia’s Ministry of Tourism and Creative Economy explains how NFTs and cryptocurrency can help solve social and economic challenges within Indonesia.

One of the primary benefits of blockchain technology is the ability to record and capture information in a permanent, tamper-proof record. Once data is on a blockchain network, it cannot be altered, making it an ideal solution for record-keeping.

Tokenized assets, such as nonfungible tokens (NFTs), can also be placed on a blockchain. This can verify ownership while demonstrating that certain events occurred at particular times. For example, the Meta History Museum tokenized data from the war in Ukraine in May 2022, placing the information on a blockchain network to preserve records of the war.

Ensuring that specific events take place is also becoming more important than ever due to the rise of artificial intelligence (AI) and its ability to generate deep fakes, along with historical images that may appear realistic.

NFTs for preserving cultural heritage

Preserving information using decentralized technologies is gaining traction. For instance, Muhammad Neil El Himam, deputy chairman for digital economy and creative products in Indonesia’s Ministry of Tourism and Creative Economy, told Cointelegraph that he recently formed a partnership with Quantum Temple — a technology company using NFTs for preservation — to help maintain the country’s cultural heritage. Himam explained that NFTs could ensure that heritage can be preserved and created without limits:

“I believe that NFTs can contribute to preserving Indonesia’s cultural heritage while enhancing virtual tourism. NFTs may also be a medium in ushering in the next billion users into the crypto space, especially if the NFT elements of the cultural heritage are well-known and appreciated.”

Linda Adami, CEO of Quantum Temple, told Cointelegraph that her firm developed a multichain NFT marketplace to bring cultural heritage and tourism to the Ethereum and Algorand blockchain networks. Adami explained that the platform is working closely with Indonesia’s Ministry of Tourism and Creative Economy to tokenize tangible and intangible cultural heritage as unique digital assets.

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“Digital representations include traditional ceremonies, craftsmanship, and knowledge of nature and our universe, but also musical and oral expressions, dances and pilgrimages. By tokenizing cultural heritage, three critical areas of value are created: immutable archives of culture, transparent alternative income streams through royalties, verified provenance and recognition for cultural creators,” she stated.

On March 21, 2023, Quantum Temple launched its “Paths to Alangö” NFT collection at L’Atelier des Lumières in Paris, France, during Paris Blockchain Week. “The collection includes 11 unique NFTs that represent different aspects of Balinese cultural heritage, such as dances, temples, landscapes and philosophy. The NFTs are created by local artists and cultural heritage experts,” Adami said.

*NFT artwork displaying a Galungan celebration at Penglipuran Village in Bali, Indonesia. Source: Quantum Temple*

Adami said that technological innovations such as blockchain could play a significant role in addressing key challenges within a country’s cultural sector.

“Authenticity and quality are fundamental to cultural heritage’s tangible and intangible value. Blockchain can be used to create an immutable and invaluable record that recognizes authorship and guarantees the authenticity and provenance of creative assets,” Adami remarked.

Harry Halpin, CEO and co-founder of decentralized privacy platform Nym, told Cointelegraph that documenting things like cultural artifacts is becoming critical to prevent manipulation. According to Halpin, blockchain technology is one of the best ways to ensure this, noting that Nym has been working with the decentralized storage provider Filecoin to document war crimes on its blockchain network.

With this potential in mind, Himam believes that it is highly likely other regions will incorporate blockchain elements in the future. “Indonesia is just one example of many developing countries that have begun to explore the potential of these technologies,” he said.

Challenges remain

While tokenized digital assets could be a solution for preserving important information, regulatory and technical challenges may hamper adoption. For instance, while Himam is bullish on blockchain technology, he noted that regulatory uncertainty within the region might create friction.

Himam said that Indonesia’s Commodity Futures Trading Regulatory Agency controls how blockchain technology is applied domestically. “Crypto assets are categorized as a commodity that can be used as the subject of futures contracts traded on an exchange,” he said. However, he added that as Indonesia begins to implement more blockchain use cases, the government will start to establish clear regulations and policies on how decentralized technologies could be applied.

It’s also notable that Indonesia’s national crypto exchange is scheduled to be completed in June 2023. According to Himam, Indonesia is showing clear interest in cryptocurrency adoption. “The country has created regulations around cryptocurrencies and is encouraging their use,” he said.

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However, Indonesia’s technical infrastructure could create challenges for projects using decentralized networks. Himam pointed out that blockchain-based technologies require specialized infrastructure, such as digital wallets, which may not be widely available in certain areas in Indonesia. This, coupled with the fact that most Web3 projects require skilled professionals, could result in slow regional innovation.

Despite the challenges, Quantum Temple’s Adami believes that Asian institutions may be the furthest along in understanding blockchain-based use cases. “The Indonesian Ministry of Tourism and Creative Economy leadership understands how NFTs could offer a new funding model for the cultural and creative sector while also protecting the intellectual property rights of artists,” she remarked.

Crypto gateway Alchemy Pay scores license in Indonesia

Alchemy Pay has partnered with a local fintech in Indonesia to offer low-cost remittances for crypto users.

Alchemy Pay has obtained a license from the central bank of Indonesia to operate remittances and fund transfers in cooperation with local fintech firm Berkah Digital Pembayaran.

Announcing the news on Feb. 27, Alchemy Pay noted that Bank Indonesia issued the licenses jointly to Alchemy Pay and Berkah Digital’s platform BDPay, enabling the firms to offer better payout methods and reduce associated operating costs.

Fiat-to-crypto payment provider Alchemy Pay is expanding services in Asia by scoring new regulatory approval in Indonesia.

Exciting news! #AlchemyPay and @mybdpay have jointly received license from the Central Bank of Indonesia to operate remittances and fund transfers.
Read more at: https://t.co/FFkC5Jvv2Y $ACH

— Alchemy Pay|$ACH: Fiat-Crypto Payment Gateway (@AlchemyPay) February 27, 2023

According to data from the official website of Bank Indonesia, Berkah Digital has been listed as a payment service provider under license category three. The firm is mainly known for its BDPay platform, which offers retail and corporate clients local and cross-border remittance services. The platform also provides client payroll services and transfers via bank application programming interfaces, allowing users to transfer to 136 banks in Indonesia.

Alchemy Pay’s cryptocurrency on-ramp supports payments via Mastercard, Visa, Google Pay, Apple Pay and a number of other regional mobile wallets like BDPay. The platform so far operates in 173 countries.

Established in 2018 in Singapore, Alchemy Pay is a major global crypto-to-fiat payment platform known for partnerships with crypto giants like Binance exchange. The firm also operates its own utility token, Alchemy Pay (ACH), issued on the Ethereum blockchain. ACH is a major part of the Alchemy Pay network, providing transaction fees, network rewards and other processes.

Indonesia to launch national crypto exchange in 2023: Report

The platform comes as a part of the plan to shift the regulatory oversight from the commodities agency to the securities authority.

As a part of its reform of crypto regulation, Indonesia will create a crypto exchange in 2023, according to reports. The platform is planned to be launched prior to a shift of regulatory power from commodities to securities authority.

On Jan. 4, the head of the Commodity Futures Trading Regulatory Agency of Indonesia (Bappebti), Didid Noordiatmoko, stated that a crypto exchange should be set up this year. The move comes as a part of broader financial reform launched in December 2022.

In accordance with the reform, in the next two years, the crypto oversight will be taken from Bappebti, a commodities-focused agency, by the Financial Services Authority (FSA).

The Financial Sector Development and Reinforcement bill (P2SK) was ratified by the House of Representatives of Indonesia on Dec. 15 to become the primary legal reference in the financial service sector. Explaining the shift of authority from Bappebti to the FSA, cemented by the bill, Suminto Sastrosuwito, a head of Financing and Risk Management of the national finance ministry, claimed that:

“In fact, crypto assets have become investment and financial instruments, so they need to be regulated on an equal basis with other financial and investment instruments.”

Indonesia imposed a blanket ban on crypto payments starting in 2017, while trading in digital assets has largely remained legal in the country. In the first days of January, Noordiatmoko revealed that the value of crypto transactions in the country fell by half in 2022 — from 859.4 trillion Indonesian rupiahs ($55 million) to 296.66 trillion ($19 million).

In December, Bank of Indonesia Governor Perry Warjiyo announced the release of the conceptual design of a digital rupiah — a currency the equivalent of the country’s fiat — which will be made available for public discussion.

Binance increases stake in Tokocrypto after initial investment in 2020

This is the third licensed Asian cryptocurrency exchange Binance has upped its stake in as it expands its global reach; the company had shown signs of struggling.

Binance has increased its shareholding in Indonesian crypto asset trader Tokocrypto, according to local reports on Dec. 19.

The cash injection was confirmed in a tweet by Binance CEO Changpeng Zhao (CZ), who characterized the deal as having “just injected more cash and increased our shareholding a bit.” Changes are expected at the exchange.

Tokocrypto founder Pang Xue Kai will reportedly step down as CEO, to be replaced by Yudhono Rawis as interim chief. Pang Xue Kai will remain on the company’s board of commissioners.

CNBC quotes Pang Xue Kai as saying:

“This decision was made after careful consideration and we decided that the best step for Tokocrypto going forward is to leverage Binance’s capabilities to build a further physical trading platform for crypto assets.”

Reports emerged on Dec. 6 that Binance was in talks with Tokocrypto, driving the value of its TKO coin up 50%. It was also reported at the time that a round of layoffs would occur if the buyout went through. Tokocrypto laid off 45 people, or 20% of its staff, in September. It also spun off its community space T-Hub and nonfungible token marketplace TokoMall at that time.

NOT A RUMOR! @binance is acquiring @tokocrypto, one of Indonesia's largest crypto exchange

here's what we know pic.twitter.com/6kv0AlIYnd

— Coinvestasi (@coinvestasi) December 19, 2022

Binance first invested in the Indonesian company in 2020. In 2021, Tokocrypto was reportedly considering an initial public offering, although the offering never took place.

Tokocrypto was founded in 2018 and became Indonesia’s first crypto exchange to receive approval from the country’s Commodity Futures Trading Regulatory Agency (Bappebti) the following year. That agency’s approval has since become mandatory for crypto exchanges. Seventeen companies had received Bappebti approval by March of this year.

Binance acquired Sakura, a licensed Japanese crypto exchange, in November and MX Global, a licensed Malaysian exchange, in March. By buying companies that are already licensed, Binance can operate without having to obtain a license itself.

Update Dec. 20, 1:31 am UTC: Changed the headline which previously suggested that Binance had acquired 100% of Tokyocrypto.

Central bank plans to make CBDC ‘only legal digital tender’ in Indonesia, says gov

“Collaboration and synergy on national and international level is critical to the development of Digital Rupiah,” said Perry Warjiyo.

Bank of Indonesia Governor Perry Warjiyo has announced developments in its plans to launch a central bank digital currency, or CBDC, for “various digital economic and financial transactions.”

In a Dec. 5 speech at the central bank’s annual meeting, Warjiyo said the bank planned to release details on the conceptual design of a digital rupiah — a currency the equivalent of the country’s fiat — and open the matter to public comment. According to the governor, the Bank of Indonesia intended for the digital rupiah to be “integrated, interconnected, and interoperable” with other countries’ CBDCs following discussions with central bank officials.

The CBDC initiative, called Project Garuda, will start with the launch of a wholesale digital rupiah for “use cases of issuance, redemption, and interbank fund transfer” followed by “monetary operations and financial market development.” The project’s white paper states that the third phase will deal with end-to-end transactions between wholesale and retail digital rupiah users.

“Collaboration and synergy on national and international level is critical to the development of Digital Rupiah,” said Warjiyo.

*Digital rupiah roadmap. Source: Bank of Indonesia*

Indonesia imposed a blanket ban on crypto payments starting in 2017, while trading in digital assets has largely remained legal in the country as regulated under the Commodity Futures Trading Regulatory Agency. Warjiyo first announced plans for Indonesia to introduce a CBDC in May 2021 but did not provide a specific timeline for the digital currency’s release.

How to build a Bitcoin Beach: Advice from the pros

Founders of Bitcoin Beach El Salavdor, Bitcoin Ekasi in South africa, Dakar Bitcoin Days in Senegal and Global Bitcoin Fest shed light on building Bitcoin communities around the world.

How does one build a Bitcoin (BTC) community? How to start? Where to begin? And what are the best practices?

Cointelegraph spoke to Bitcoin community builders around the world to shed light on a growing phenomenon in the Bitcoin world.

From Indonesia to South Africa to El Salvador and the Congo, circular-based Bitcoin economies and community projects have sprung up across the globe. Cointelegraph asked the successful community-focused Bitcoiners how to kickstart a Bitcoin circular economy and what advice they’d lend to enthusiasts looking to replicate the success of projects like Bitcoin Beach, El Zonte.

*Using Bitcoin at Bitcoin Beach. Source: Twitter*

For Bitcoin community project leader Mike Peterson, it starts with Lightning. Peterson pioneered the Bitcoin Beach project in the sleepy surf town of El Zonte, El Salvador. The circular economy energized an entire nation and eventually led to El Salvador adopting Bitcoin as legal tender in 2021. Peterson told Cointelegraph:

“You need to be using lightning for for people to be transacting and to build a circular economy. It really needs to be built on lightning. [..] You need to get people transacting.”

The layer-2 Lightning Network is a payments solution built on top of Bitcoin. In El Salvador, El Chivo is among the most popular Lightning-enabled Bitcoin wallets, although it has experienced issues since its rollout. Across the rest of the world, Bitcoin enthusiasts use Wallet of Satoshi, Muun Wallet, CoinCorner or Blue Wallet to instantly transact with one another. Peterson continued:

“If you get them making that first transaction and they see how easy it is and that they’ve actually sent value from one person to another in like a second time for hardly almost no fees, that’s what the light bulb goes off and they realize the value that that has.”

Ultimately, leading with Lightning helps newbies realize that Bitcoin can be easy and even fun. In the Isle of Man, where there is a budding Bitcoin community, United Kingdom-based exchange CoinCorner has found inventive ways to demonstrate the Lightning Network.

*Bitcoin Ekasi Project next to Mossel Bay, South Africa. Source: Twitter*

Hermann Vivier, founder of Bitcoin Ekasi in the Western Cape of South Africa, shared a few tricks to establishing a Bitcoin economy. First, while it’s important to “put one foot in front of the other,” and “just start,” he said, try to see if there’s a preexisting community to tap into:

“We had something that that was already existing and we built the Bitcoin community on top of that.”

Bitcoin Ekasi is a township project that keeps kids away from gangs in school and among South Africa’s Atlantic waves, where they learn lifeguarding and surf skills. Vivier teaches Bitcoin as another element of the kids’ education.

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Furthermore, Vivier also shared that it’s important to keep it simple. Stick to Bitcoin, he joked. His hours of labor and love given to this community project have turned him into a “Bitcoin maximalist,” as it helps in avoiding the risk of scams in crypto, while blockchain buzzwords can get in the way of making progress:

“I would say 100% focus on Bitcoin only. And if there was something better than Bitcoin out there, then that’s what you should focus on. But at the moment Bitcoin is where it’s at.”

Nourou, founder of Bitcoin Senegal, a community-led Bitcoin project in West Africa, told Cointelegraph, “You cannot create a community if you aren’t capable of answering people’s questions–and that requires a wide range of knowledge.”

Iman Yudha, who leads a group of crypto and Bitcoin enthusiasts in Indonesia, agrees. He told Cointelegraph that it’s important to “Get educated first–before you make any decisions. That’s my personal opinion.”

After establishing a solid basis of foundational knowledge about Bitcoin, crypto and security. Nourou recommends to start talking about Bitcoin with close relations:

“Start with the family if you can’t convince your mother, your brother, your sister, the cousins, and so on, it’s a bad start.”

He notes that the following step varies depending on the culture, business practice and environment. Over in Senegal, “it is the wealthiest who roughly define fashion, who define trends. So people tend to copy them.” It’s for that reason that Nourou tried to target his Bitcoin communication to those communities first. Incidentally, Nourou is hosting West Africa’s first major Bitcoin conference, Dakar Bitcoin Days, on Dec. 2 in West Africa’s largest theater.

*Cointelegraph attended Dakar, Senegal’s first ever Bitcoin meetup in 2022.*

Lukas, a co-founder of Global Bitcoin Fest — which holds marathon Twitter Spaces for people all around the world — again encourages Bitcoin enthusiasts to focus on the people. It can be “lonely” in the land of Bitcoin, he told Cointelegraph, so finding a team with shared values can spur things along. He shared an example:

“It’s a conversation that I’ve had recently with two guys in Zimbabwe. They want to kickstart a [project] there. He wanted to do it, but he was alone. […] Then he found Metamorphoses, another great maxi, and now they’re forming a team — and the energy is completely different now.”

Yudha chimed in, sharing that energy and enthusiasm are critical, and community builders should avoid being “toxic” where possible.

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In short, these Bitcoin pioneers suggest finding like-minded individuals to work with, starting small, taking advantage of existing communities, knowing and understanding the subject matter and not overstretching. The simplest way to do this is to focus on Bitcoin and Bitcoin only. And to get people interested and transacting, get people using the Lightning Network because that’s what gives people their own light bulb moment.

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.”

*Proposed changes to Indonesia’s Commodity Futures Trading Regulatory Agency on crypto. Source: YouTube*

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.

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.

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

The country’s deputy trade minister confirmed the intention, first voiced last year.

The government of Indonesia returned to its plan to set up a digital assets exchange, publicly announced for the first time back in 2021. The so-called “crypto bourse” is planned to be established by the end of 2022.

According to DealStreetAsia, Indonesian Deputy Trade Minister Jerry Sambuaga confirmed during NXC International Summit 2022 in Bali that the country is still planning to launch the crypto bourse, but the whole project has been delayed due to additional preparations:

“We will make sure that every requirement, procedure and the necessary steps have been taken.”

Sambuaga also described the inevitable preparatory tasks ahead of the launch, such as assessing which entities “could be included in the bourse” and setting the minimum requirements for them.

Pang Hue Kai, CEO of Tokokrypto — one of 25 licensed crypto exchanges in Indonesia, with a large share owned by Binance — called the project a catalyst for the Indonesian crypto ecosystem.

The first announcement of the national crypto bourse came in December 2021. At the time, it was reported that the venture capital arm of state-owned telecommunication company PT Telkom Indonesia and crypto exchange Binance would form a joint venture.

In a bid to diversify its assets, Indonesian tech company PT GoTo Gojek Tokopedia Tbk bought a local crypto exchange, PT Kripto Maksima Koin, for 124.84 billion rupiahs ($8.38 million).

According to data from Indonesia’s Commodity Futures Trading Regulatory Agency, the total transaction volume of crypto assets in Indonesia in 2021 rose more than 1,000% compared with 2020, rising to 859.4 trillion rupiahs ($57.7 billion). Roughly 4% of the country’s population, which is a little under 11 million people, have been investing in crypto.

Indonesian e-commerce giant buys local crypto exchange for $8 million

By acquiring PT Kripto Maksima Koin, the tech giant pursues a goal of becoming “a diverse money management hub.”

Indonesian tech company PT GoTo Gojek Tokopedia Tbk (GoTo) bought PT Kripto Maksima Koin, a local crypto exchange, in a bid to diversify its assets. The deal makes a landmark in the merging of mainstream and crypto in the fourth most populated country in the world.

As reported by Reuters, the sum of the acquisition of 100% shares by the country’s “biggest tech firm” came to 124.84 billion rupiahs ($8.38 million). The deal was finalized on Thursday, according to Indonesian media.

GoTo didn’t reveal any specific plans for PT Kripto Maksima Koin’s further development, but in an official statement, its representatives explained t deal as part of its effort to “a diverse money management hub.”

PT Kripto Maksima Koin is one of the 25 crypto platforms licensed by Indonesia’s Commodity Futures Trading Regulatory Agency (BAPPEBTI). It received the license relatively recently, on Jan. 28, 2022.

Earlier this year, GoTo, which is th result of a merge between a local e-commerce leader and an on-demand multi-service platform, conducted its initial public offering (IPO), raising $1.1 billion.

According to Reuters data, in 2021, thetotal transaction volume of the crypto assets in Indonesia rose more than 1,000% compared to 2020, to 859.4 trillion rupiahs ($57.7 billion). Roughly 4% of the country’s population, which is a little under 11 million people, have been investing in crypto.

In recent years, the country has seen a rising tide of celebrity coins and nonfungible token (NFT) projects, with regulators’ having to weigh in, albeit somewhat mildly. BAPPEBTI has repeatedly warned the population about the risks of investing in non-registered digital assets but has also avoided harsh prosecutions, involving even thenon-registered providers in a dialogue.

Indonesia-licensed crypto asset platform Pintu raises $113M in Series B

The latest $113 million fund injection will be redirected to scale the platform’s existing offerings, such as introducing new features and added support for blockchains.

Indonesian crypto asset platform Pintu announced the closure of a $113 million Series B funding round with participation by four prominent investors: Pantera Capital, Intudo Ventures, Lightspeed and Northstar Group.

Licensed by the Commodity Futures Trading Regulatory Agency, or Bappebti, under the Ministry of Trade, Pintu caters to Indonesian crypto investors dealing in popular cryptocurrencies, including Bitcoin (BTC) and Ether (ETH).

Bappepti previously highlighted that the number of Indonesian crypto investors in 2022 doubled from 2021, to which Jeth Soetoyo, founder and CEO of Pintu, said:

“We believe that crypto adoption in Indonesia is only in its beginning stages, and educating users on the fundamentals is critical to ensuring this growth continues in a healthy way.”

The latest $113 million fund injection will be redirected to scale the platform’s existing offerings, such as introducing new features and support for blockchains. The company also plans to add more tokens and launch new products to solidify its position in Indonesia further.

In the only two years since its inception, Pintu has launched numerous features on its mobile application that allow users to earn and stake their crypto holdings. In addition, a part of the Series B funding will be dedicated to Pintu Academy, an educational program for crypto traders that aims to spread awareness about the opportunities and risks of crypto investing.

As Cointelegraph recently pointed out, crypto investments in Indonesia saw considerable growth between 2020 and 2022, with 4% of the country’s population having invested in crypto.

Celebrity involvement in crypto seemingly fueled the adoption spree among Indonesian investors. In addition to the participation of popular stars such as Joe Taslim, Jessica Iskandar and Shandy Aulia, the Indonesian celebrity crypto scene witnessed numerous nonfungible token (NFT) launches.