National Islamic Council of Indonesia Declares Bitcoin Officially Haram

The National Ulema Council (MUI), Indonesia’s top Islamic scientific body, has reportedly determined that cryptocurrencies such as Bitcoin (BTC) are haram, or prohibited, according to the principles of Islam.

Bitcoin banned according to Islamic principles

Asrorun Niam Sholeh, chairman of MUI’s Fatwa committee, confirmed the religious authority’s rejection of cryptocurrencies. The reasoning behind this was alleged elements of “uncertainty, gambling and harm”.

In order for the MIU to approve crypto trading, cryptos such as Bitcoin must adhere to sharia guidelines as a commodity or digital asset and demonstrate a “clear advantage”. This is what Sholeh said to allegedly after an expert MIU hearing.

the MIU discussed Bitcoin as part of the Ulama Fatwa committee. It is designed to address Indonesia’s biggest social, political, economic and legal issues through the lens of Islamic law.

The East Java Department of the MIU previously issued a fatwa from. This is a “formal statement or interpretation on a point of Islamic law, given by a qualified jurist”. At the end of October, the use of cryptocurrency was declared haram.

Judgment is not legally binding

Although the MIU is a government-funded organization, the latest decision of the council is to allegedly not legally binding. The MUI admits that the fatwa there is no law in Indonesia. However, according to some sources, it can still be used as a source of “legislative inspiration”.

According to Bloomberg, the MUI’s latest decision does not mean that all crypto trading in Indonesia will be halted. However, the council could discourage Muslims from investing in cryptocurrencies. It could also prompt local institutions to reconsider crypto issuance.

The news comes shortly after Bitcoin briefly passed $69,000 for the first time in history on Wednesday. The Indonesian government has taken a mixed stance on crypto regulation. The local authorities already imposed a general ban on cryptocurrency payments in 2017. Still, local authorities have preferred to keep crypto trading legal. In August, local crypto exchange Pintu raised $35 million from some of the largest investors in the crypto and blockchain industries.

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