According to reports, Indonesia’s leading Islamic academic organisation, the National Ulema Council (MUI), has declared cryptocurrencies like Bitcoin (BTC) to be haram, or banned, under Islamic teachings.
MUI’s Fatwa Commission head, Asrorun Niam Sholeh, reiterated the religious authority’s condemnation of cryptocurrency. Citing “uncertainty, wagering, and injury” as reasons.
For the MIU to sanction crypto trading, cryptocurrencies like Bitcoin must fulfil Shariah principles as a commodity or a digital asset. And provide a “concrete advantage”, according to Sholeh, who spoke after an expert MIU session.
The MIU discussed Bitcoin as part of the Ulama Fatwa Commission. Which aims to use Islamic law to address some of Indonesia’s most pressing social, political, economic, and legal challenges.
In late October, the MIU’s East Java chapter issued a fatwa, which is a “formal judgement or explanation on a matter of Islamic law presented by a certified legal expert,” pronouncing bitcoin use haram.
The fatwa isn’t legally enforceable, However, it can be a source of “legislative inspiration”
Despite the fact that the MIU is a government-funded body, the council’s most recent decision is not legally enforceable, according to reports. The fatwa is not Indonesian law. Nevertheless, according to some sources, it can be utilised as a source of “legislative inspiration.”
The MUI’s new decision, according to Bloomberg, does not imply that all crypto trading in Indonesia would be prohibited. The council, on the other hand, may discourage Muslims from investing in cryptocurrency. And force local institutions to rethink issuing cryptocurrency.
On the other hand, the announcement comes only days after Bitcoin momentarily broke through the $69,000 price barrier. For the first time in history on November 10.
In terms of cryptocurrency legislation, the Indonesian government has adopted a varied approach. Despite imposing a blanket ban on cryptocurrency payments in 2017, local governments have chosen to make bitcoin trading lawful. Pintu, a local cryptocurrency exchange, received $35 million in August from some of the industry’s top investors.