Head of Malaysian Shariah Advisory Council Encourages To Make Cryptocurrency Investment

 It has been three months since the permission to trade digital assets in Malaysia was approved under Islamic law and the religious community in Malaysia admits that crypto investment has skyrocketed.

The head of the Shariah Advisory Council (MPS) of the Securities Commission Malaysia (SC), Dr Mohd Daud Bakar did not deny that the crypto industry has great potential in the country despite having to face the challenge of applying and understanding ideas on asset classes.

It is estimated that only 2% of Malaysians understand the concept of cryptocurrency.

It is not certain where the mistake is, but Bakar said since crypto is not considered a legitimate tender under religious law, then the asset can be considered as a commodity, provided it is not supported by ribawi goods.

To be clear, ribawi goods mean materials that must be exchanged for the same size as gold and silver.

Perhaps the Muslim community in Malaysia is still skeptical of crypto status from a religious point of view, but in 2018 Indonesian firm FinTech has declared Bitcoin investment legal under sharia law.

It has been clarified by its executive officer, Matthew Martin that cryptocurrency investments are more transparent than fiat currency because of its proof-of-work-based characteristics rather than debt.

Thus, last July, the authorities decided to allow digital asset investments in Malaysia based on sharia law.

Bakar also encourages to take advantage of cryptocurrencies as a commodity or investment in a company.

To date, Malaysia has three crypto exchange platforms, namely Luno Malaysia, Tokenize Malaysia and Sinegy Technologies.

However, Binance currently only supports Ringgit Malaysia due to not having permission to operate in the country.