Kyber Network exec: Indonesian nat'l exchange to impact crypto future
When Indonesia rolls out its national crypto exchange, the whole world will be watching.
When Indonesia rolls out its national crypto exchange this June, the whole world will be watching.
"This is an experiment that some other countries, perhaps those with similar economic and population makeup, may view with interest to see if there are positive outcomes they can replicate," Kyber Network and KyberSwap Head of Marketing Imran Mohamad told Digital Life Asia.
Crypto in Indonesia
Mohamad cited the estimates from Indonesia’s Ministry of Trade, saying more than 14 million Indonesians already own cryptocurrency, compared to just nine million who are engaging in stock trading. Of course, this is still a small number in a nation with a total population of almost 274 million, of which about 180 million are unbanked.
Asked if he believes the national exchange would accelerate crypto adoption in Indonesia, Mohamad replied: "While setting up a national crypto exchange will certainly bring more attention to cryptocurrency in Indonesia, it may perhaps act as a highly controlled and censored platform, in contrast to having free markets operating. Another aspect to consider is Indonesia's large Muslim population and their local religious authorities (National Ulama Council) declaring cryptocurrency 'haram' or not permitted."
The creation of the Indonesian national crypto exchange will also result in a regulatory shift.
"Crypto assets in the country are currently traded alongside commodity contracts and supervised by the Commodity Futures Trading Regulatory Agency — also known as Bappebti — but the regulatory power will shift to the Financial Services Authority following the creation of a national exchange.
"The regulatory shift comes in response to new crypto regulations ratified on Dec. 15, which recognize crypto and other digital assets as regulated financial securities."
Regulation and decentralization
Will the increasing trend of government regulation around the world lessen the appeal of crypto?
"The regulators' jobs are to protect the economy and the people, and thus anything that has potential impact will be reviewed and managed by any regulator across the world. What's happened in the last couple of years, especially in countries like the US, China, India, Indonesia, and Singapore, will likely accelerate adoption from other countries. In general, regulation is good to call the industry and individuals to accountability, but it should happen without hindering innovation, progress, and human freedoms. Of course this is easier said than done," Mohamad said.
He also said that he believes it will be possible to protect the web3 ethos of decentralization in the wake of increasing regulation.
"As long as people believe that they have the right to hold their own assets and use them in the way that they wish, which is an expression of human freedoms, there will always be a voice for decentralization. A few things that could be done is for citizens and citizen groups to consistently let their elected representatives and lawmakers know that this is important to them.
"Concurrently, the blockchain and decentralized finance industry has to step up their engagements, firstly as a collective industry, perhaps setting agreed standards, code of ethics, and security measures that the industry adheres to, and also being open to engaging regulators in constructive discourse. For example, the Point Zero Forum was held in Zurich in 2022 with the Monetary Authority of Singapore as a key partner, welcoming other regulators and industry players, and Kyber Network was present as a representative of blockchain and decentralized finance," he said.
With well-known brands such Starbucks and Nike embracing non-fungible tokens and web3 in general, will 2023 be the year crypto finally becomes mainstream?
"The cryptocurrency and blockchain industry is at an early stage with the Bitcoin white paper released less than 15 years ago. If you looked at the huge computer rooms that sent rockets to the moon in the 1960s, all that computing power now fits into a single thumbnail with the advancements of transistors.
"I think crypto and blockchain are in our clunky 'huge computer room' era and advancements in technology, improvement in user interfaces and experiences, as well as security and privacy, will enable cryptocurrency and blockchain to become mainstream, but perhaps not in the next year, but next decade," Mohamad said.
As we always hear on Crypto Twitter: we're early.