Cryptocurrency news: Indonesia bans crypto for all Muslims over wagering concerns

In a strange twist, 88 per cent of the population are banned from trading crypto but the remainder are free to do as they wish.

Around 88 per cent of Indonesia’s population has been banned from trading cryptocurrency after it was deemed a sin by a religious council.

The National Ulema Council, or MUI, said on Friday that cryptocurrency was “haram”, which means forbidden under Islamic law.

Asrorun Niam Sholeh, head of religious decrees, said cryptocurrency was banned because it “has elements of uncertainty, wagering and harm”, according to Bloomberg.

Known for its wild fluctuations and speculative nature, cryptocurrency has been known to rise or fall by huge percentages in a single day.

However, Mr Sholeh offered a caveat to allow some form of cryptocurrency trading to still continue in the southeast Asian country.

Mr Sholeh provided a way out of the ban for crypto enthusiasts.

He said that if cryptocurrency could follow Sharia law by showing a clear benefit to society, then it can be traded.

Indonesia’s government has been pro-cryptocurrency with plans for an ETF later this year.

Although the ban has thrown a spanner in the works, it won’t grind cryptocurrency trading to a halt completely in the country.

The remaining 12 per cent of Indonesia’s population, who are not Islamic, are free to do as they please with the blockchain.

Indonesia has the world’s largest Muslim population of more than 200 million people. Its finance ministry and central bank consults the MUI before making major decisions related to the Islamic population.

The country has been slammed by human rights groups in the past for its harsh punishments towards religious rule breakers, with its ultraconservative district of Aceh known for public canings.

Other Muslim countries have had a markedly different approach to cryptocurrency.

Bahrain has backed crypto assets since 2019 when they weren’t as common and mainstream.

Over in the United Arab Emirates, cryptocurrency can only be traded in free zones, with its capital city, Dubai, containing more than 30 of them.

China, although not at all a majority Muslim country, sensationally banned cryptocurrency at the end of September in a major tech crackdown.

“Virtual currency-related business activities are illegal financial activities,” the People’s Bank of China said at the time.

The central bank said offenders would be “investigated for criminal liability in accordance with the law”.

The notice bans all related financial activities involving cryptocurrencies, such as trading crypto, selling tokens, transactions involving virtual currency derivatives and “illegal fundraising”.

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