Managing finances often presents unique challenges for expats living in Indonesia. From navigating local banking regulations to dealing with currency exchanges, expats frequently face more complicated financial landscapes than their counterparts back home.
Conventional investment assets, such as stocks, bonds, and real estate, have been reliable choices for expats when they are still living in their home country. However, accessing those conventional assets becomes difficult when they move up to another country.
Over the past decade, there is a new class of asset that has gained popularity: crypto. Crypto offers an alternative for those seeking to diversify their investments across borders and hedge against inflation.
Why Crypto Investment Appeals to Expats
- Global Accessibility: Crypto is accessible from anywhere with just an internet connection. It allows expats to invest without being bound by geographical restrictions, making it a more flexible option.
- Currency Hedging: Expats frequently deal with currency exchanges when transferring funds back to their home country. Crypto can help mitigate currency fluctuations by serving as a universal asset. Bitcoin, for instance, is often referred to as “digital gold” because of its finite supply, which can make it a viable option to hedge against inflation.
- Borderless Transactions: With crypto, you can transfer funds internationally at lower costs compared to conventional remittance systems. For expats who send remittances or receive income from multiple countries, this can lead to significant savings.
- Investment Growth Potential: Crypto is volatile, which can make it risky, but this volatility also presents growth opportunities. For expats comfortable with higher-risk investments, crypto can provide significant long-term returns.
Key Crypto Expats Should Know About
While there are thousands of crypto on the market, not all are worth considering as an investment. Here are some of the key players that expats should be aware of:
- Bitcoin (BTC): The first and most widely recognized crypto, often considered a store of value.
- Ethereum (ETH): Ethereum is often used as a base for other applications and decentralized finance (DeFi) projects.
- Ripple (XRP): This crypto can be an ideal choice for expats who regularly send or receive funds internationally.
- Stablecoins (USDT, USDC): Stablecoinis crypto that is pegged to the value of a fiat currency, like the USD, which can provide the stability of traditional currency while retaining the advantages of crypto.
Each crypto serves different purposes and comes with its own set of risks, so it’s essential to conduct thorough research before investing.
Getting Started with Crypto Investment as an Expat
1. Choose the Right Exchange
- As an expat, ensure the exchange you choose operates in your host country and is compatible with your bank accounts. One of the examples of global exchanges that are also available in Indonesia is Luno, which has been trusted by more than 12 million customers worldwide for over 10 years.
2. Know the Tax Implications
- Crypto is subject to different tax regulations around the world. Some countries require reporting of crypto holdings, while others may impose capital gains taxes. If you’re an expat in a country with strict tax rules, consider consulting a tax professional who understands both crypto and cross-border finance.
3. Keep Up with Regulatory Changes
- Always stay informed about the latest policies in your country of residence and your home country to avoid legal complications.
Tips for Managing Your Crypto Portfolio as an Expat
- Diversify Your Holdings: Avoid putting all your money into a single crypto. Diversifying can help manage risk.
- Set Clear Investment Goals: Are you looking for short-term gains, or are you planning for long-term growth? Having clear goals can help you make better investment decisions.
Stay Informed: The crypto space is constantly evolving, with new projects, regulations, and trends. Follow reliable crypto news sources and consider joining expat communities to stay updated.
Ready to Start Your Crypto Journey?
Download the Luno app, available on Google Play and the App Store. Use promo code LUNOEZPZ while registering on Luno to get free Bitcoin worth Rp100,000.
Luno is registered and supervised by the Commodity Futures Trading Regulatory Agency (Bappebti). Trading and investing in crypto assets is a high-risk activity. Read more on our Terms of Use here: www.luno.com.