Tuesday, September 26, 2023

Indonesia Enjoys The Highest Crypto Adoption Rate Worldwide: Study

Dion Bisara
April 4, 2022 | 12:26 pm
An illustration of Bitcoin. (B1 Photo)
An illustration of Bitcoin. (B1 Photo)

Jakarta. Crypto assets ownership in Indonesia was among the highest globally as many investors in the country look at digital assets as a protection against future inflation, according to a study by crypto exchange Gemini published on Monday. 

The study, titled "Global State of Crypto Report," found that 41 percent of Indonesians, aged between 18 and 75 years old with an income of more than $14,000 per year, own crypto assets. The country shared the top spots with Brazil among the 20 countries surveyed by Gemini. 

Indonesia Enjoys The Highest Crypto Adoption Rate Worldwide: Study
Source: Gemini's 2022 Global State of Crypto Report

"Many investors in the country may look to crypto as an inflation hedge," Feroze Medora, the interim managing director and director of trading at Gemini Asia Pacific, told the Jakarta Globe in an email over the weekend. 

"It has been a long-held notion that bitcoin operates as a sort of 'digital gold.' Should the value of bitcoin, or any other chosen crypto, increase with time, this will protect the decreased purchasing power of a currency that results from the loss of its value," Medora said. 


Furthermore, the study found that 61 percent of Indonesian respondents agree with the notion that crypto is the future of money. Compared to 23 percent in developed countries lithe the US, France, and Germany. 

Cryptocurrencies like bitcoin, Ethereum, and Solana have gained traction in Indonesia in the past few years. The government decided to accommodate the currency's development as part of its larger strategy to transform the country's digital economy. While cryptos are illegal as a medium of exchange in Indonesia, the government allows them to be traded as commodities. 

The number of crypto investors in Indonesia has doubled in the past year alone to more than 12 million people, according to data from Commodity Futures Trading Regulatory Agency (Bappepti). In comparison, Indonesia's number of stocks market investors was just north of 7 million. 

Gemini's study was not "fully representative of the total population of the large and multicultural nation," Medora said. With a $14,000 annual income cut-off, the study represented only the high-income earners in Indonesia, a country with a per capita income of around $4,350 last year.  

Still, the report provided a better understanding of the current adoption rate in Indonesia and the wider Asia Pacific region, Medora said. 

"Indonesians have already been known to be technologically savvy, so they have adapted to this relatively new digital asset class," Medora said. 

Also, the report found a trend unique to Indonesia's crypto scene. According to the study, 51 percent of crypto owners were women. Only two other countries in the study, Israel and Nigeria, had at least the same number of men and women in crypto ownership. 

"This report has challenged the belief that cryptocurrency is a 'boys club,'" Medora said. 

"The prevalence of crypto mobile apps has made crypto even more accessible to everyone - regardless of gender. Additionally, there is no lack of online crypto educational materials, so these elements may have helped narrow and even tip the gender balance when it comes to crypto investing," he said. 

Indonesia Enjoys The Highest Crypto Adoption Rate Worldwide: Study
Source: Gemini's 2022 Global State of Crypto Report

Still, Indonesian crypto investors face similar concerns as their peers worldwide, Medora warned.  

"Many crypto owners have a fear of financial loss when it comes to crypto investing, and many investors may feel that they have little to no protection in the market," he said. 

While acknowledging the Indonesian authority's effort to balance investors' protection and allow room for the crypto sector growth, Medora said it was investors' responsibility to be aware of the risk of their crypto investment. 

"It is vital for all crypto investors to do their own research before investing in a token and ensuring that they use a trustworthy exchange to conduct their trades," Medora said. 

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