Cryptocurrency transactions in Indonesia reached 30 billion USD in the first 10 months of 2024, increasing 350% compared to the same period last year, surpassing the total transactions of 2022 and 2023 combined.
The Indonesian cryptocurrency market has witnessed a remarkable recovery in 2024, achieving a total transaction value of 30 billion USD from January to October, growing 350% compared to 6.5 billion USD in the same period of 2023.
The figure also far exceeds the total transaction of 19.4 billion USD for the entire year of 2022 and marks the highest transaction level since the peak of 54 billion USD in 2021. The strong growth indicates the increasing attraction of cryptocurrencies in Indonesia, despite market fluctuations and tax policies in recent years.
Drivers of Recovery
The impressive recovery of the Indonesian cryptocurrency market is attributed to a combination of several factors, including the easing of investment regulations and the high cryptocurrency acceptance rate among the youth.
One of the key factors is the CoFTRA regulation (PerBa) No. 9 of 2024, issued in September, which has eased restrictions on institutional investors in cryptocurrencies, facilitating a significant flow of capital into the market.
At the same time, according to Chainalysis' Global Cryptocurrency Acceptance Index, Indonesia ranks in the top 3 countries with the highest cryptocurrency acceptance rates in the world, only behind India and Nigeria. The Asia-Pacific region, including Indonesia, continues to lead globally in cryptocurrency acceptance rates, with 7 out of the top 10 countries in this region.
The table shows Indonesia's 3rd position on Chainalysis' Global Cryptocurrency Adoption Index. Source: Chainalysis
Especially in Indonesia, over 60% of cryptocurrency investors are under 30 years old, indicating the long-term growth potential of the market. The average age of cryptocurrency investors in Indonesia is lower than in European and American markets, contributing to a higher acceptance rate.
However, the 'double tax' policy applied since 2022, taxing 0.1% on profits from cryptocurrencies in addition to the standard income tax, is believed to be one of the reasons for the market's significant decline in 2022. The strong recovery in 2024 indicates the enormous potential of the market, while also raising questions about the effectiveness of this double tax policy.
Industry experts have called on the government to reconsider this policy, especially in the context of the new government under President Prabowo Subianto, who took office in October, is restructuring and may bring positive changes to the cryptocurrency market.