Indonesian Islamic Council Prohibits Cryptocurrency For Muslims

Per the Indonesian Islamic Council, the usage of virtual currency assets has been prohibited for Muslims for the time being. The Federal Ulema Council has declared that all cryptocurrency transactions are now declared haram, which means they are prohibited. Following the professional hearing that took place on Thursday, the leader of religious regulations released the following statement:

“Its ability to provide a concrete benefit is the primary concern with cryptocurrencies; as a result, it must not be handled and is absolutely forbidden by Sharia law.”

MUI is regarded as a Sharia institution in Indonesia, which has the globe’s biggest Muslim destination and is home to the world’s greatest Muslim community. Various financial authorities in the country, such as the ministry of finance and the banking system, are constantly collaborating with the Commission on financial issues.

The Council Decision Doesn’t Mean Immediate Suspension

The ruling of the council does not really necessarily imply that trading in the region has come to an end at this time. The Ministry of Finance will make the final decision on the legality of financial transactions involving digital currency in the future. Previous reports indicated that the Bank of Indonesia was prepared to issue a central bank digital currency, but the bank did not confirm that this would happen in the near future.

In Indonesia, cryptocurrency transactions totaled 370 trillion Rupiah ($26 billion) in the very first 5 months of this year, a fraction of the worldwide market, which is estimated to be worth approximately $3 trillion. In some cases, religious authorities in Indonesia may have positions that differ from those held by religious authorities in other Muslim-majority nations. The United Arab Emirates has enabled cryptocurrency trading in Dubai’s free place since 2017, and Bahrain has backed cryptocurrency assets since the beginning of 2019.

Crypto In Dubai

Back in September, the Securities and Commodities Commission and the Dubai World Trade Centre Authority agreed to regulate, issue, list, and trade crypto investments and associated investment operations within the DWTCA’s free zone. The accord was reached by SCA interim CEO Dr. Maryam Al Suwaidi and DWTCA Director-General Helal Saeed Al Marri.

In a statement, Al Suwaidi mentioned that the deal was reached in reaction to Minister of Economy and SCA Board Chairman Abdulla bin Touq Al Marri’s directions to increase cooperation and exchange information and skills with various government agencies, institutions, and bodies. Providing, issuing, trading, and registering crypto assets are all regulated by the SCA within the DWTCA free zone. Also, the SCA will oversee, manage, and investigate the licensed firms operating within the free zone. Al-Marri said in a statement that he wanted to “enhance its operations as a free zone of option for international investors and entrepreneurs.”