According to reports, the National Ulema Council, Indonesia’s most important Islamic scholarly body, has declared cryptocurrencies such as Bitcoin (BTC), haram (or forbidden) by the Tenets of Islam.
Asrorun Sholeh, chair of MUI’s Fatwa Commission confirmed that the religious authority rejected cryptocurrencies because of alleged elements like “uncertainty and wagering” and “harm.”
Following an expert MIU hearing, Sholeh stated that crypto trading must comply with Shariah guidelines and demonstrate a clear benefit.
MIU members discussed Bitcoin in the Ulama Fatwa Commission. This commission is intended to tackle some of Indonesia’s most pressing social, political and economic issues through Islamic law.
A fatwa was issued by the MIU’s East Java branch in October declaring cryptocurrency haram.
Although the MIU is funded by the government, the latest decision of the council is not binding. According to some sources, even though the MUI acknowledged that the fatwa was not Indonesian law, it can still be used as a source for “legislative inspiration.”
Bloomberg reports that the MUI’s latest decision doesn’t mean all crypto trading in Indonesia will be stopped. The council’s decision could discourage Muslims from investing in crypto, and force local institutions to reconsider issuing crypto assets.
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This news comes just after Bitcoin briefly crossed the $69,000 mark on Wednesday.
The Indonesian government is taking a mixed approach to crypto regulation. Although they had previously banned cryptocurrency payments in 2017, the local authorities prefer to allow crypto trading. Pintu, a local crypto exchange, raised $35 million in August from some of the largest investors in the blockchain and crypto markets.