Market Analysis: Could October Be a Good Month for the Crypto Market?

BONSERNEWS.com – The Commodity Futures Trading Supervisory Agency (Bappebti) of the Ministry of Trade released the latest figures regarding the number of investors and the volume of crypto asset trading transactions in Indonesia. As a result, since the beginning of 2022, there has been a significant decline.

In the latest released data, in 2021, the total value of crypto asset trading transactions reached IDR 859.5 trillion. Meanwhile, the total transaction value in January-August 2022 was recorded at IDR 249.3 trillion, down 56.35 percent compared to the same period in the previous year.

Meanwhile, in terms of the number of investors, as of August 2022 there were 16.1 million subscribers with an average increase in the number of registered subscribers of 725 thousand subscribers per month. This means that the number of crypto investors in Indonesia continues to grow.

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Chairman of the Association of Indonesian Crypto Asset Traders (ASPAKRINDO), Teguh Kurniawan Harmanda, sees the decline in the volume of crypto transactions in Indonesia as a domino effect of what is happening globally. The global crypto market is being hit by an unfavorable macroeconomic situation this year.

“Global financial system shocks can have quite a large effect on the crypto market. These shocks are a shaky macroeconomic situation due to recession and heated geopolitics. This can cause a crypto winter situation to occur,” said the man who is familiarly called Manda, Friday, October 7 2022.

According to him, the sluggish crypto market was also driven by US monetary policy, which made investors less enthusiastic. As is known, according to Statista, the US has the largest trading volume of Bitcoin on exchanges.

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The Fed’s tightening policy of raising its benchmark interest rate to suppress inflation could threaten the crypto market. The increase in interest rates eventually leads to higher commodity prices and lower purchasing power, investors will stay away from the market.

“The increase in the price of basic necessities has made investors wait and see. This is what is starting to be felt in Indonesia, investors prefer to wait for the right moment to re-enter the crypto market, when the macroeconomic situation is stable,” he explained.

Crypto Tax Implementation

In addition to macroeconomic factors, the application of crypto asset taxation also has an effect. The Indonesian government through the Ministry of Finance has succeeded in pocketing state revenue from crypto taxes of IDR 126.7 billion as of August 2022.

“Basically, we as crypto asset industry players in Indonesia are happy with the existence of crypto tax regulations. That way, the crypto industry can be more legitimate and can help increase state revenue from the tax sector,” said Manda.

ASPAKRINDO’s internal data found the tax had a lasting effect on local crypto traders or exchanges compared to global ones. Local exchange transaction volume has not been able to rebound after the tax was imposed, in contrast to global.