One of Indonesia's – and the world's – largest Islamic organizations has declared cryptocurrency as haram, or forbidden for Muslims.
Muhammadiyah on Tuesday published a fresh fatwa (religious edict) forbidding the use of crypto as an investment tool or as a transactional tool.
"Their speculative nature is haram according to sharia," the fatwa reads, as published on Muhammadiyah's official website.
In November 2021, the Indonesian Ulema Council (MUI), the highest clerical body in the country, issued a fatwa declaring crypto haram as a transactional tool. But the council noted that if cryptocurrency as a commodity or digital asset can abide by sharia tenets and can show a clear benefit, then it can be traded for investment.
The Nahdlatul Ulama (NU), another major Islamic organization in Indonesia, also previously issued a fatwa on cryptocurrency using MUI's guidelines.
MUI and NU's fatwas did not halt crypto transactions in Indonesia. Crypto investment has been growing at an incredible rate in the country in recent years, with transactions amounting to IDR859.4 trillion (US$59.8 billion) throughout 2021. That represents 1,222 percent increase from 2020.