After being associated to the Darknet for many years, cryptocurrencies have finally made their breakthrough on the positive side of several authorities. The globe has an array of diverse religions with their own set of rules. Even though cryptocurrencies have taken off in terms of popularity, some Islamic countries still fall back on the adoption of crypto. Malaysia is one of those lists, and a prominent member of the Shariah Advisory Council sheds light on the same.
Malaysian Authorities Bullish On Crypto
Recently, a Malaysian news portal reported that the Securities Commission Malaysia (SC) Shariah Advisory Council chairman, Dr. Modh Daud Bakar revealed his stance on cryptocurrency. Before indulging in certain ventures, people of the Islam religion need to make sure that it is compliant with the Shariah. The Shariah is a code that governs the lives of Muslims. With the world steering towards the adoption of cryptocurrencies, in July, the Shariah Advisory Council permitted Muslims to engage in crypto-related activities on registered crypto exchanges. Despite this, Bakar believes that the people in Malaysia still require time to fully grasp crypto from the Shariah viewpoint.
Recently, speaking at the SCxSC Fintech Conference 2020, held virtually, Bakar said,
“It is a medium of exchange, and we cannot stop people to use commodities as medium of exchange. It is as good as buying an e-ticket or commodities in the market.”
He also added that since cryptocurrencies are not viewed as legal tender under the religious law, it can be rather considered a commodity. However, it shouldn’t be backed “ribawi items”. Bakar pointed out that the adoption of crypto could pave the way to several “interesting areas” in the country. Through this, the crypto could be labeled as an investment asset that would further allow the citizens to trade, buy as well hold crypto assets.
The debate of crypto being accepted and compliant with Islamic laws is still underway. However, several suggest that since cryptocurrencies like Bitcoin is based on proof-of-work and not debt it is considered permissible. Despite this, only three crypto exchanges including Luno Malaysia, Tokenize Malaysia, and Sinegy Technologies are licensed to operate in the country.
Praising the prospects of cryptocurrencies, Bakar added,
“The potential of this currency is as great as it comes with a growing digital economy of the world.”