Indonesia religious council says crypto trading forbidden for Muslims

“The use of crypto assets as a currency is forbidden for Muslims, according to Indonesia’s council of religious leaders,” Bloomberg reported.

Details:

• The National Ulema Council has deemed trading in cryptocurrencies as “haram” and effectively banned for Muslims in Indonesia as it involves uncertainty, wagering, and harm, according to Asrorun Niam Sholeh, head of religious decrees. He added that the currency can be traded if it adheres to Shariah tenets and can show a “clear benefit.”
• However, this does not mean that all cryptocurrency trading will be stopped in Indonesia, but it could discourage Muslims from investing in the asset.

Dive deeper:

• The comment from Indonesia’s council of religious leaders comes amid the central bank’s plans to launch a digital rupiah currency due to a strong rise in online transactions as a result of the Covid-19 pandemic.
• Companies that operate in predominantly Muslim countries generally tend to stay within the rules of Sharia or Islamic law. Recently, Pakistan-based fintech startup Abhi raised US$2 million to give employees the option to take salary advances in a bid to forego loans.