In Brief:
- Indonesia’s council of religious leaders rules crypto as forbidden for Muslims.
- The MUI’s decision does not mean that all crypto trading in the country will be banned.
According to Indonesia’s council of religious leaders, crypto is forbidden for Muslims. The National Ulema Council (MUI) declared crypto as haram as it has factors of uncertainty, wagering, and harm and is forbidden under Sharia law.
According to Asrorun Niam Sholeh, head of religious decrees, to be approved for crypto trading by MIU, cryptocurrencies such as Bitcoin must meet Sharia guidelines as a commodity or digital asset and show a “clear advantage.”
Chairman Soleh also stated that cryptocurrencies are not permissible under Islamic law because they have no physical form, no real value, the exact amount is unknown, and property rights can be transferred to the buyer.
MUI is the Shariah compliance authority in Indonesia, with the finance ministry and central bank consulting them on Islamic finance issues.
The MUI’s decision does not limit all cryptocurrency trading in Indonesia, but it may discourage Muslims from investing in the assets and cause local institutions to reconsider issuing crypto assets.
In May, Indonesia started considering taxing cryptocurrency trades due to the increased popularity among local investors. This was followed by the Indonesia Financial Services Authority warning investors about the danger of investing in cryptocurrency.
Also Read: Binance Considering Crypto Venture with Indonesia’s Heavyweights
