As China and the United States trade interminable barbs over tech, trade, policy, and more, Southeast Asia continues to be something of an enigma: on the one hand, it’s a battleground in the high-stakes tussle between the two global powers; on the other, there are machinations at work for the nations of Southeast Asia to become a force in their own right. Unified by the Association of Southeast Asian Nations (ASEAN), the ten-member intergovernmental organization is vying to set its own global agenda for growth and prosperity, rather than being forced to choose sides in Chinese-American bilateralism.
In no small way, Indonesia is making a push to assert itself as the leader among the ASEAN countries. With both the largest population and the largest GDP in the group, Indonesia is poised to set the tone for the region -- especially with President Joko Widodo (or Jokowi, as he is known) having just won five more years leading the government.
While many Indonesians have lamented some of the more backwards-looking actions taken by Jokowi in his first term, the president (once commonly referred to as “Indonesia’s Obama”) appears to be well aware that there is no regional leadership among ASEAN countries -- and limited agency on the global stage -- in the absence of innovation. And while there are many ‘horses of innovation’ to bet on at this particular moment of history, Indonesia is hitching its wagon to blockchain.
Bappebti Thaws Its Cool Stance To the Blockchain
To be sure, Indonesia only recently changed its tune regarding cryptos. Amid concerns of rampant fraud and perhaps even seeing financial order being upended, the Jokowi-led government initially turned its back on the blockchain when it issued an outright ban on cryptocurrencies that took effect on January 1, 2018 in the wake of the crypto mania of 2017.
While the use of bitcoin in transactions for goods and services is still prohibited, the country has signaled that it’s ready to dip its toes in innovating through the blockchain. Back in February, the Indonesian government announced that it was creating legal frameworks through which cryptos and digital asset futures will operate. This came just a few days after the Commodity Futures Trading Regulatory Agency (or Bappebti) announced that bitcoin and other cryptocurrencies would be classified as trading commodities -- not unlike copper or tin (to which Indonesia is home to the world’s largest market).
Done