Buying a villa in Bali with cryptocurrencies

Indonesian legislation requires all domestic transactions to be conducted in rupiah (IDR), the national currency. Currency Law No. 7/2011 explicitly states that “all payments within the territory of Indonesia must be made in rupiah” and prohibits requiring or using foreign currencies for internal payments. As a result, cryptocurrencies are not recognized as legal tender in Indonesia.

In fact, Bank Indonesia has repeatedly clarified that while crypto-assets may be held or traded as investment commodities, they cannot be used to pay for goods or services in the country. Indonesian authorities have reinforced this position with recent warnings. In 2023, the Governor of Bali announced strict measures against tourists or local businesses that accept cryptocurrencies as payment, warning of sanctions ranging from fines and business closures to deportation for violating monetary laws.

In short, making a real estate payment directly in Bitcoin, Ethereum, or any other cryptocurrency is prohibited, as all property transactions must be formalized in IDR to be legally valid. Violations may lead to criminal liability (up to one year in prison and substantial fines) for “imposing a currency other than the rupiah” in a payment.

Indirect use of cryptocurrencies: conversion to rupiah via escrow

Despite the prohibition on direct payments, cryptocurrencies can be used indirectly as long as they are converted into rupiah during the transaction. In practice, buyers and sellers may agree to use an escrow service or a crypto payment processor that receives the cryptocurrency and immediately converts it into IDR before the transaction is finalized.

It is essential that the sale and purchase agreement sets the price in rupiah and clearly describes the conversion mechanism (exchange rate, timing, and who bears the volatility risk) in order to comply with regulations. Under these arrangements, cryptocurrency acts solely as a vehicle for transferring value, while the invoice, contract, and final payment are documented in rupiah, as required by law. For example, the buyer may deposit Bitcoin or USDT into an escrow account; this amount is then converted into rupiah at the agreed exchange rate and transferred to the seller in IDR.

In this way, the seller receives the funds in rupiah (in compliance with the law), while the buyer effectively uses crypto assets to finance the purchase. Many real estate operators in Bali that accept crypto follow this approach, working with platforms registered with BAPPEBTI (the Indonesian regulator for futures trading and crypto assets) or with authorized third parties that transparently settle cryptocurrencies into local currency.

Maintaining a clear documentary trail is crucial. Both parties should retain proof of conversion, blockchain transaction records, and invoices denominated in IDR to support the payment. In addition, for tax and compliance purposes, the seller’s income is reported in rupiah. It is advisable to include contractual clauses specifying how the IDR equivalent will be calculated and what happens in the event of cryptocurrency price fluctuations before closing. This ensures legal certainty for the transaction and minimizes the risk of future disputes.

Legal structures for foreigners (PT PMA and alternatives)

Another critical aspect is that Indonesia does not allow foreigners to directly own property under freehold title (Hak Milik). However, this does not prevent a foreigner from acquiring a villa in Bali, provided that appropriate legal structures are used.

The legally recognized options include:

Long-term lease agreements (Hak Sewa):

This is the most common and straightforward route. The foreign buyer obtains a leasehold right, typically for 25 to 30 years (renewable), which grants full rights to use, rent out, and enjoy the villa during that period. Legally, the land remains owned by an Indonesian national, but a properly registered lease agreement provides legal certainty and protection for the foreign investor.

Right of use or right to build through a local company:

A foreigner may establish a PT PMA (Perseroan Terbatas Penanaman Modal Asing), a foreign-owned limited liability company under Indonesian law. As a legal Indonesian entity, a PT PMA is allowed to acquire real rights over real estate, particularly Hak Guna Bangunan (right to build, valid for up to 30 years and renewable) or Hak Pakai (right of use). Through a PT PMA, the investor indirectly controls the villa in a manner similar to ownership and may also legally conduct commercial activities, such as operating the villa as a vacation rental. This corporate structure complies with Indonesian investment regulations and offers longer-term security, with the possibility to transfer or inherit the rights in accordance with the law.

In all cases, local legal advice is strongly recommended. Law firms in Bali with experience in real estate transactions can guide foreign buyers toward the most suitable structure based on their objectives (personal use versus commercial investment) and ensure that all contracts (lease agreements, acquisitions through a PT PMA, etc.) comply with current regulations. Proper due diligence is essential: verifying land titles, licenses, zoning, and permits related to the villa before purchase is key to avoiding legal issues. By following the correct steps, it is indeed possible for foreigners to buy a villa in Bali, even if ownership is achieved through derivative rights or via a local company.

Experiences with real estate payments using cryptocurrencies in Bali

Despite legal restrictions, Bali’s real estate market has begun to incorporate cryptocurrency-based transactions through the indirect mechanisms described above.

Several recent examples show that this approach is viable when structured correctly:

• Local real estate agencies: Some agencies in Bali openly advertise that they accept crypto and have developed solid experience in handling these transactions. For example, the CEO of a local real estate firm stated in 2025 that “approximately 50% of our clients choose to pay with cryptocurrencies,” reflecting growing demand and trust in properly implemented crypto payment structures. These transactions are carried out securely, with clear procedures for conversion and legal review, and from the buyer’s perspective they are largely similar to a traditional purchase, aside from the method used to transfer value. The use of stablecoins (e.g., USDT) is common to minimize volatility during the payment process.

• Developers and promoters: In 2021, Finns Bali (a major local developer) announced that it was the first to officially accept cryptocurrencies as a form of payment for its luxury villas and apartments. They implemented a system in which the buyer transfers crypto assets to the parent company in Singapore (Finns Global Ltd), where the funds are converted and then invested into the property in Bali following “regulatory protocols” to remain compliant with the law. The developer even covered the associated taxes, simplifying the process for the buyer. This success case, endorsed by the Bali Tourism Board, demonstrated a practical route for conducting real estate transactions in Bali using crypto: the key was converting the cryptocurrencies outside Indonesia and bringing the funds into the country as legally compliant IDR.

• Pioneering transactions: Bali was also the setting for one of the world’s first real estate purchases made with Bitcoin. As early as 2014, an enthusiast acquired a luxury villa by paying approximately 800 BTC (around USD 500,000 at the time). Although this deal took place in a context of limited regulation, it is considered an early milestone. Today, there are reports of local agents selling villas while accepting Bitcoin, generating significant media attention, provided that the final transfer was formalized in accordance with Indonesian regulations. For instance, there have been recent sales in Bali denominated in cryptocurrency, with the consent of crypto-savvy sellers, where the speed of this payment method helped close deals more efficiently before converting the funds into rupiah.

Overall, more sellers and real estate projects are becoming open to cryptocurrency-based offers, driven by the growing number of crypto investors interested in Bali. That said, both agencies and developers stress the importance of structuring transactions correctly to avoid violating monetary regulations. The general consensus is that cryptocurrencies can be used in Bali’s real estate sector only “behind the scenes,” as a method of transferring value that is converted into local currency at the time of payment. This hybrid solution allows investors to benefit from the advantages of crypto (speed, global reach, and reduced banking friction) without breaching Indonesia’s foreign exchange and currency laws.

Key considerations before completing a transaction using cryptocurrencies

From a tax perspective, Indonesia has developed a specific framework for crypto transactions and real estate ownership that buyers must take into account:

Taxes on converting or selling cryptocurrencies

In 2022, Indonesia introduced taxes on crypto assets. Converting cryptocurrency into fiat currency (for example, into rupiah as part of a property purchase) is subject to a very low final income tax (around 0.1% of the transaction value). This tax is final and is intended to tax potential capital gains from crypto in a simplified way.

Important: if the conversion is carried out through a foreign exchange that is not registered in Indonesia, the applicable rate may be slightly higher (e.g., around 1%). However, when using local platforms or authorized channels, the reduced rate (approximately 0.1%) applies. In addition, Indonesia exempts these conversions from VAT, treating them more like financial transactions than the sale of goods.

In short, Indonesia taxes crypto transactions at very low rates compared to many other countries, which makes it attractive for crypto investors. Nevertheless, these taxes must be declared and settled, usually through the entity processing the conversion (the exchange or broker typically withholds them).

Taxes on the property transaction

When purchasing property in Bali, standard real estate taxes apply regardless of whether the source of funds is crypto or not. On the buyer’s side, there is generally a property transfer tax (BPHTB) of 5% of the property value (with possible exemptions or reductions for modest housing).

If the property is new and purchased from a developer, it is usually also subject to real estate VAT at 11% (Indonesia’s standard VAT rate) on the sale price. In practice, many developers include this VAT in the price or apply it depending on the property title (for example, Hak Pakai may be subject to VAT).

On the seller’s side (if the seller is an individual), the law imposes a final capital gains tax of 2.5% on the sale price, which is typically withheld at the time of the transaction. All of these taxes are calculated and paid in rupiah, which means the sale and purchase agreement must reflect the value in IDR even if the funds originate from converted crypto. It is advisable to coordinate with a local notary or lawyer to ensure these payments are handled correctly at the time of executing the deed of sale. Here you will find all the key aspects you need to consider when buying a villa in Bali.

Anti–money laundering (AML) regulations

Real estate transactions—especially those involving digital assets—may be subject to increased regulatory scrutiny. Indonesia has strict AML/KYC rules for high-value transactions. If you plan to bring funds via cryptocurrencies, you must be able to document the legitimate origin of those funds and comply with any reporting requirements.

Financial intermediaries or exchanges that convert crypto into rupiah must be properly registered and apply identity verification procedures. Property owners or agencies that accept crypto-related payments in Bali typically request a copy of the payer’s passport and retain detailed transaction records (contracts, blockchain hashes, conversion receipts) for at least five years. This ensures they can respond to potential audits or regulatory inquiries and demonstrate compliance with AML and counter–terrorist financing regulations. In short, transparency and traceability are essential: a serious buyer should be prepared to disclose the source of their crypto assets if required, just as they would with a conventional international bank transfer.

Exchange rate risk and volatility

While using cryptocurrencies can speed up the transfer of funds, their volatility poses a risk. Over a short period, the value of Bitcoin or Ethereum can fluctuate significantly against the rupiah. To mitigate this, transactions often use U.S. dollar–pegged stablecoins (such as USDT), or they fix the crypto-to-IDR exchange rate in the contract within a very short payment window.

For example, an invoice may be issued requiring the buyer to send the equivalent amount in BTC or USDT calculated at a specific date and time, valid for 30 minutes. If payment is not completed within that window, the crypto amount is recalculated. These measures help avoid disputes if the crypto market moves sharply during the transaction.

Additionally, some deals use crypto escrow services that lock the funds until certain conditions are met (such as the signing of the deed), protecting both parties from volatility and ensuring that conversion to rupiah takes place at the agreed moment.

Therefore, it is indeed possible to buy a villa in Bali using cryptocurrencies in a legal and viable way, provided that the transaction is properly structured in accordance with Indonesian law. In practice, this means always setting the official purchase price in rupiah, using a reliable mechanism to convert crypto assets into IDR (preferably through registered entities or outside Indonesia), and applying the appropriate legal structures for ownership when the buyer is a foreigner. Consulting with specialized local lawyers is essential to navigate these details correctly. Indonesian authorities do not prohibit the holding or investment in crypto assets, in fact, the country encourages crypto trading under a commodities-based regulatory framework, but they are very clear that the rupiah is the only legal means of payment.

By respecting this rule (that is, converting your crypto into rupiah at the time of purchase) and addressing the relevant tax and legal structure considerations, you can successfully complete the acquisition of your villa in Bali using capital derived from cryptocurrencies, combining financial innovation with legal certainty in this paradisiacal destination.