Indonesian Islamic organization still against bitcoin

One of Indonesia's largest non-governmental Islamic organizations recently issued a fatwa, an Islamic law ruling, against the use of bitcoin in the country, and pointed to two critical issues with cryptocurrencies making them illegal as an investment tool and a half. of exchange according to Islamic laws: “the speculative nature of cryptocurrencies makes them imperfect as an investment tool. Cryptographic tokens are believed to contain "gharar" (darkness), which means they are not backed by assets such as gold, which makes them illegal under Islamic laws. " Cryptocurrencies do not meet the standards of Islamic bartering or media exchange laws which require them to be legal tender and accepted by both parties. The fatwa read: "This speculative and gharar nature is prohibited by the Shari’a as the word of God and hadith of the Prophet SAW and does not meet the values and benchmarks of business ethics according to the Muhammadiyah."

Muhammadiyah became the third Indonesian Islamic organization to issue a fatwa against the use of cryptocurrency. Earlier, in November 2021, the Indonesian Ulema Council (MUI), the country's highest clerical body, declared haram cryptocurrencies as a transactional tool. However, he noted that crypto assets can be used as an investment tool if they comply with sharia principles. In October 2021, another major Islamic organization, Nahdlatul Ulama (NU), also deemed crypto haram due to its speculative nature. Despite growing calls for a ban on the use of cryptocurrencies by Islamic organizations in Indonesia, the country has seen a huge increase in adoption. The country recorded $ 9.8 billion in crypto transactions in 2021, a 1,222% increase over 2020. Not just investments and transactions, the recognition of crypto as a trading commodity has made it the top choice of many crypto exchanges internationally.