Indonesia lets you trade cryptocurrency - but you can’t use it to buy coffee, pay for a ride, or settle an invoice. That’s the strange reality for millions of Indonesians who own Bitcoin, Ethereum, or other digital assets. The country has one of the largest crypto markets in Southeast Asia, with over 14 million active users and $8.1 billion in trading volume in 2024. Yet, if you try to pay someone with USDT or BTC, you’re breaking the law.
Why the Ban Exists
The ban isn’t new. It started in 2016 with Bank Indonesia Regulation No. 18/40/PBI/2016, which said virtual currencies can’t be used as payment. That rule was strengthened in 2017 with Regulation No. 19/12/PBI/2017. Both laws target every kind of payment system operator - exchanges, e-wallets, gateways, and money transfer services - and forbid them from handling crypto transactions. The reason? Indonesia’s Currency Law says only the rupiah is legal tender. That’s not just a technicality; it’s a core part of how the country controls its money supply and protects its financial system. Bank Indonesia, the central bank, worries that if crypto became a payment method, it could undermine monetary policy, cause currency volatility, and make it harder to track illegal activity. In November 2025, Bank Indonesia’s Executive Director of Communication, Agusman, made it clear: “Virtual currency including bitcoin is not recognized as a valid payment instrument. It is prohibited to be used as a means of payment in Indonesia.” The message hasn’t changed in nearly a decade.Trading Is Legal - But Only Under OJK
Here’s where it gets confusing. While you can’t use crypto to pay for things, you can buy, sell, and hold it - legally. That’s thanks to the Financial Services Authority, or OJK. On January 10, 2025, oversight of crypto assets officially moved from Bappebti (the commodity regulator) to OJK, which treats crypto as digital financial assets, not commodities. OJK Regulation No. 27 of 2024 set strict rules for exchanges, custodians, and token issuers. To operate legally, they need:- Minimum capital of IDR 50 billion ($3.2 million) for exchanges
- IDR 25 billion ($1.6 million) for custodians
- IDR 10 billion ($640,000) for token issuers
The Operational Divide
This split between trading and payments creates real headaches for businesses. A company can legally run a crypto exchange under OJK rules, but if a customer tries to pay for a product using Bitcoin, the business can’t accept it - even if they’re licensed by OJK. This is called “regulatory schizophrenia” by William Sutanto, CTO of Indodax, Indonesia’s biggest exchange. “You’re told to build a compliant trading platform,” he said in a September 2025 interview, “but then you’re told you can’t let people use what you’re trading to pay for anything.” It forces companies to build two separate systems: one for trading (OJK-compliant) and another for customer payments (ruled by Bank Indonesia). Many small businesses can’t afford that complexity. Some simply avoid crypto altogether.
How People Are Bypassing the Ban
Despite the rules, people are finding ways to use crypto for payments anyway. A survey by Indodax in August 2025 found that 63% of users had made crypto-based payments informally - through peer-to-peer transfers, gift cards, or prepaid credits. On Kaskus, Indonesia’s biggest forum, a popular thread titled “How to Pay with Crypto Without Getting Caught” has been viewed over 47,000 times. It details how sellers convert crypto into e-wallet credits, mobile top-ups, or even Steam gift cards. One merchant, u/JakartaToko, lost a $12,000 international order because their client’s company policy required payment in USDT. “BI’s payment ban cost me three months of revenue,” they posted on Reddit in October 2025. Professor Budi Suharjo from Universitas Gadjah Mada found in his 2025 study that 68% of merchants accept crypto payments unofficially. That means the ban is widely ignored - but it also means consumers have no legal protection. If a crypto payment goes wrong, there’s no recourse.Taxation Changed - But Not the Ban
In August 2025, the Ministry of Finance made a big move. It scrapped the 1% VAT on crypto transactions and replaced it with a 0.21% final income tax on transaction values. That’s a huge drop - and it signals that the government now treats crypto more like stocks or securities than goods. The Directorate General of Taxes created a special unit with 147 auditors to monitor crypto activity. They’re linked directly to OJK’s monitoring system (SIM IAKD), so every trade is tracked. This shows the government is serious about collecting taxes - but still not about letting crypto be used as money.
How Indonesia Compares to Neighbors
Indonesia’s approach is stricter than most in Southeast Asia. - Thailand allows crypto payments in select retail stores under strict licensing. - Singapore permits licensed payment providers to accept crypto. - Malaysia bans crypto payments but is testing pilot programs to relax rules. - Vietnam also bans payments but lacks a strong regulatory body. Indonesia stands out because it has a clear, well-developed trading framework - but refuses to let that framework extend to payments. That’s closer to the EU’s MiCA rules than its neighbors’. But it also means Indonesian businesses pay 37% more for international settlements and wait 3.2 extra days to process cross-border payments, according to Alvarez & Marsal’s July 2025 analysis.What’s Next?
There’s talk of change. A draft law, No. 12/2025 on Digital Rupiah Integration, is being reviewed by Indonesia’s House of Representatives. It could create a bridge between the central bank’s digital currency and crypto assets - possibly allowing limited crypto payments through a government-controlled channel. But Bank Indonesia’s Governor Perry Warjiyo made it clear in October 2025: “Any relaxation of the payment prohibition would require comprehensive assessment of monetary policy transmission mechanisms.” Translation: don’t expect a change soon. Meanwhile, experts warn of brain drain. Hasan Fawzi from OJK says the fee waiver shows support for innovation. But Robby, head of the Indonesian Blockchain Association, says rigid rules are pushing talent away. In the first half of 2025, 27 crypto professionals left Indonesia for Singapore or Dubai.Bottom Line
Indonesia’s crypto payment ban isn’t about stopping crypto. It’s about controlling money. The government wants to let people trade digital assets - safely, transparently, and under strict rules. But it won’t let those assets become money. For users, that means you can invest in crypto. You can even earn from it. But you can’t spend it like cash. And while many find ways around the ban, those workarounds come with risk. No protection. No recourse. No legal safety net. The real question isn’t whether the ban will last. It’s whether Indonesia can keep its booming crypto market growing while holding onto a rule that feels increasingly out of step with how people actually use money today.Can I use Bitcoin to pay for goods in Indonesia?
No. Under Bank Indonesia regulations, cryptocurrency cannot be used as a payment method for goods or services. This applies to all businesses, including online stores, restaurants, and service providers. Even if a merchant accepts Bitcoin, they are violating the law.
Is crypto trading legal in Indonesia?
Yes. Since January 2025, crypto trading has been regulated by the Financial Services Authority (OJK). Exchanges, custodians, and token issuers must be licensed, meet capital requirements, and follow strict AML/CFT rules. Over 14 million Indonesians trade crypto legally through licensed platforms like Indodax and Tokocrypto.
What happens if I get caught using crypto to pay for something?
Individual users rarely face penalties. The law targets payment system operators - exchanges, e-wallets, gateways - not end users. But if you’re a business accepting crypto as payment, you risk fines, license revocation, or criminal charges. Most users who bypass the ban do so informally, through peer-to-peer transfers or gift cards, which carry no legal protection.
Why did Indonesia move crypto regulation from Bappebti to OJK?
Bappebti treated crypto as a commodity, like soybeans or gold. OJK treats it as a financial asset, like stocks or bonds. The shift in January 2025 reflected a more mature approach - focusing on investor protection, market integrity, and financial stability rather than just commodity trading oversight.
Are there any plans to lift the crypto payment ban?
There’s a draft law under review that could allow crypto payments through a central bank digital currency (CBDC) bridge, but Bank Indonesia has said no changes are coming soon. The payment ban remains firmly in place, and any future relaxation would require major changes to monetary policy.
How has the crypto tax system changed in Indonesia?
As of August 1, 2025, the 1% VAT on crypto transactions was replaced with a 0.21% final income tax. This makes trading much cheaper and treats crypto like securities rather than goods. The tax authority now uses real-time data from OJK’s monitoring system to track trades and enforce compliance.
Can I use crypto for international payments from Indonesia?
No. Indonesian businesses are prohibited from using crypto for cross-border payments. This forces them to use traditional banking channels, which are slower and more expensive. International businesses that want to pay Indonesian suppliers must use wire transfers or other approved methods - not crypto.
Dan Dellechiaie
December 19, 2025 AT 20:19Let me get this straight - Indonesia lets you trade crypto like it’s a collectible baseball card but slaps you if you try to buy a damn nasi goreng with it? That’s not regulation, that’s institutional whiplash. OJK’s got the trading side locked down tighter than a Bitcoin private key, but Bank Indonesia’s acting like crypto is a cult they caught wind of in 2016 and still haven’t forgiven. Meanwhile, 63% of users are already using it via gift cards and P2P sleight-of-hand. The real crime isn’t the payments - it’s the bureaucratic incompetence holding back a whole generation of fintech talent. They’re not banning crypto. They’re banning common sense.
roxanne nott
December 20, 2025 AT 14:01lol the tax change is just a distraction. 0.21%? That’s like charging a penny to steal a car. They don’t care if you pay with crypto - they just want to tax the hell out of you when you cash out. And the ‘no legal recourse’ part? Classic. You’re on your own if the P2P seller ghosts you after you sent 5 BTC. Welcome to the Wild West, but with more paperwork.
SHEFFIN ANTONY
December 22, 2025 AT 07:48Everyone’s missing the point. This isn’t about control - it’s about power. The rupiah is the last thing the state has left that people actually trust. Let crypto become payment? Then you’re letting the market decide what money is. That’s terrifying for a government that still prints bills with a picture of a dead president. The OJK’s rules? Just a way to make crypto look legit so they can tax it later. And the ‘draft law’? A PR stunt. Perry Warjiyo’s not budging until he’s retired and collecting his pension.
Vyas Koduvayur
December 22, 2025 AT 19:00Look, I get why the ban exists - monetary sovereignty, financial stability, all that. But the real issue is the operational schizophrenia. Imagine running a business where your accounting team has to use two different ledgers: one for crypto trades (OJK-compliant, audited, blockchain-tracked) and another for actual payments (rupees only, cash register receipts, no blockchain, no trace). That’s not efficiency - that’s a nightmare. And the fact that small businesses just give up? That’s the silent cost. We’re not talking about some fringe tech experiment here. We’re talking about a market with 14 million active users who are literally building parallel economies because the system refuses to evolve. The government thinks it’s protecting the rupiah. In reality, it’s just making the informal economy bigger - and more dangerous.
Lloyd Yang
December 22, 2025 AT 20:21Okay, real talk - I’ve seen this play out in other emerging markets. When you tell people they can’t use something they already believe in, they don’t stop using it. They just get smarter about hiding it. That 47,000-view Kaskus thread? That’s not a loophole - that’s a grassroots protest in plain sight. And the tax shift from 1% VAT to 0.21% income tax? That’s the government quietly admitting crypto isn’t going away. They’re not banning payments because they’re scared of decentralization - they’re scared of losing control over the flow of money. But here’s the beautiful irony: by forcing people into informal channels, they’re making the system *less* transparent, not more. The real win would’ve been a regulated crypto payment layer - not a ban that just pushes everything underground. And now? They’ve got a thriving market, zero consumer protection, and a bunch of engineers fleeing to Singapore. That’s not policy. That’s self-sabotage with a spreadsheet.
Janet Combs
December 24, 2025 AT 14:51so like… you can buy bitcoin but not coffee with it? that’s wild. i feel like my phone’s gonna explode if i try to pay for my avocado toast with eth. also why does everyone act like this is normal? like, i get the ‘money control’ thing but… why not just let people do what they want? if someone wants to pay their rent in dogecoin, who’s it hurting? 😅
Jake Mepham
December 25, 2025 AT 22:11Let me tell you something - this isn’t just an Indonesia problem. It’s a global tension playing out in slow motion. Governments want the benefits of crypto: innovation, fintech growth, global competitiveness - but they don’t want to give up the levers of control. Indonesia’s playing a high-stakes game. On one hand, you’ve got a young, tech-savvy population that’s already living in a hybrid economy - crypto as investment, cash as payment. On the other, you’ve got a central bank that still sees digital money as a threat to its monopoly. The draft law on the digital rupiah? That’s the real story. They’re not trying to legalize crypto payments - they’re trying to *replace* crypto with their own version. And if that’s the endgame, then the ban isn’t a roadblock - it’s a bridge. But here’s the catch: if you build a bridge no one wants to cross, you don’t get to call it progress. You just get a really expensive empty highway. The talent leaving? That’s the real cost. Not lost tax revenue. Not payment chaos. But the quiet erosion of trust - the sense that if you’re smart enough to build the future, you better leave to do it somewhere the rules actually make sense.