Indonesian Faith Group Deems Crypto Assets “Haram”

The Indonesian religious group Nahdlatul Ulama has Posted a fatwa against the use of cryptocurrencies, claiming that it is “Haram” or prohibited by Islamic laws. The debate around the use of digital assets in the Islamic world has been going on for years now, however, many Islamic countries including Dubai and Iran have wholeheartedly accepted the use of crypto assets and are currently striving to make their use legal.

The decision to issue a fatwa against the use of digital assets came after a discussion held by the organization this week, a local daily reported. According to the reports, the discussion on digital assets heated up and was quite dynamic as they collectively decided that the use of digital assets could undermine the financial system. Another major reason for disavowing digital assets has been attributed to its problem for illegal means. The organization’s official website posted a quote that said,

“Bahtsul masail participants felt that although crypto is already recognized by the government as a commodity, it cannot be legalized under the [Islamic sharia]. “

The Islamic organization could have viewed crypto assets as Haram, but Indonesia as a country is rapidly adopting digital assets as the adoption rate has increased by 40% in the first two quarters of 2021.

Is crypto really haram?

The status of digital assets as prohibited is not a common belief among the larger Muslim brotherhood and has contrasting views varying from region to region. For example, a leading sharia compliance expert in Malaysia claimed that the use of crypto assets is not haram and that it is a form of legitimate currency.

Major religious organizations in Dubai also had a similar belief until the central bank and government decided to promote the use of digital assets. Thus, it is clear that the notion of religious groups on crypto assets is not uniform and therefore their fatwa against these assets has no impact on the use beyond a certain region.

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