Muslims can’t trade crypto, says the head of Sharia compliance in the world’s largest Islamic country

Fortune Magazine:

Indonesia’s council of religious leaders has forbidden the use of crypto assets as a currency for Muslims. 

Cryptocurrencies don’t follow Sharia tenets and should not be used by Muslims, Indonesia’s National Religious Council said, challenging the future of the online coins in the country that houses the largest Muslim population.ort by news agency Bloomberg.

The year’s hottest financial instrument is being taken up by banks, billionaires, and even countries, but it is haram, or forbidden, said Asrorun Niam Sholeh, head of fatwa, or religious decrees, at the Indonesian Ulema Council.

At an expert hearing reported by Bloomberg, Sholeh deemed that the online currency has elements of uncertainty, wagering, and harm and therefore goes against the central tenets of Islamic law. The national Ulema Council decides on Sharia compliance in Indonesia, and it is often consulted by the country’s finance ministry and central bank on Islamic financing issues.

The decision isn’t an official decree nor does it ban cryptocurrency trading in Indonesia. That being said, Sholeh’s point does have far-reaching implications on whether Muslims will feel comfortable trading the asset in Indonesia, and it may influence the take-up of cryptos by local institutions. Sholeh did say that if cryptos can show a clear benefit, it can be traded, which might be too tall an order.

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