INDONESIA Law and Practice Contributed by: Emir Nurmansyah, Monic N. Devina, D. Meitiara P. Bakrie and Ruth A. Mendrofa, ABNR Counsellors at Law
rupiah will be developed in three stages – imme - diate state, intermediate and end-state – and will run on a permitted blockchain network. The three-stage approach will create the digital rupi - ah as a wholesale CBDC (w-CBDC or w-digital rupiah cash ledger), a more-advanced w-CBDC (w-digital rupiah cash and securities ledger) and retail digital rupiah (r-CBDC). The W-digital rupiah (initial stage) will include CBDC issuance, redemption and transfer, including integration with the BI real-time gross settlement (RTGS) system. The second stage – ie, a more-advanced w-CBDC – will take the digital rupiah as a means of settlement of secu - rities transactions via central counterparties (CCP) as well as tokenisation of securities. In the final stage, the digital rupiah will become an r-CDBC to be distributed to retail users, includ - ing for distribution and collection, P2P transfer, and payments. Notwithstanding the above, by virtue of the con - solidated law within the financial sector, Law 4/2023, Indonesia now permits smart contracts as a form of contract for transactions in capital markets, money markets and foreign exchange (forex) markets, including derivatives transac - tions. Law 4/2023 further clarifies that smart contracts, or their printouts, can be used as legal evidence, as will be further stipulated in the law on information and electronic transactions. The use of smart contracts must be followed by storage of such contracts, which must at least contain terms and conditions concerning the automation of rights and performance of obligations based on a smart contract; such a contract is used as a framework agreement that contains natural language to underpin automa - tion of rights and performance of obligations in smart contracts. In other words, the use of smart
contracts in the financial sector is an alterna - tive to traditional contracts, since the contract is agreed upon in natural language, but the obliga - tions are performed by code (program). Law 4/2023 further states that smart contracts will be subject to the OJK implementing regula - tions in accordance with the law on information and electronic transactions. The OJK has been embracing the use of block - chain, as seen in the identification of blockchain- based fintech companies as a fintech cluster. Also, the OJK envisages blockchain-based tech - nology as an aid for securities crowdfunding in data exchange. 10.3 Classification of Blockchain Assets Law 4/2023 mandates the shift of authority and supervisory duties over digital financial assets (including crypto-assets), as well as other finan - cial derivatives, from Bappebti to the OJK. The transition is to be completed within 24 months, and will be subject to an implementing regulation mandated to be completed within six months after the enactment of Law 4/2023. As a result of the shift of regulatory and supervi - sory authority from Bappebti to the OJK, block - chain or crypto-assets are recognised as digital financial assets. This shift signifies that crypto- assets are no longer being classified as tradable commodities under the supervision of Bappebti . Crypto-assets may only be traded through a crypto-asset exchange supervised by OJK or futures exchange licensed under Bappebti before the authority shifted to the OJK. The assets shall also be listed in the white list which will be updated from time to time (currently, in the Bappebti List of 2025, there are 1,396 reg - istered crypto-assets). To be eligible as tradable
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