The Shariah Advisory Council at the Malaysian commission on securities has determined that it is permissible to trade and invest in cryptocurrencies via the registered crypto exchanges.
Malaysia has a population of about 32 million people. About 60% of the are Muslim (or 19.3 million). Islam is the country’s officially recognized religion. However, Shariah Law in Malaysia is only enforceable on Muslims. Much of the country’s Muslim traders and investors have been reluctant to engage in trading of cryptocurrencies in fear it might not be permitted by the Sharia Law.
The Shariah Advisory Council of the Securities Commission Malaysia (SC) has revealed its position on cryptocurrencies earlier this week on the Invest in Malaysia 2020 forum. Datuk Syed Zaid Albar, who is the head of the SC announced through a teleconference discussion that, in principle, the SC established it is permissible to trade and invest in cryptocurrencies through the registered exchanges.
He highlighted that this is a ground-breaking development that can lead to greater investments in digital assets. Further details will be available soon, Albar noted.
Malaysia started regulating the country’s steadily growing cryptocurrency industry on January 15, 2019, when a special order, issued by the Malaysia’s securities commission, went into effect. Currently, there are three cryptocurrency exchanges with a permission to operate in the country. These are Luno Malaysia, Tokenize Technology, and Sinegy Technologies.
Various studies have been initiated in the past, all coming with the conclusion that cryptocurrencies are indeed compliant with Shariah Law.
Data shows that the Muslim countries are among the ones least using cryptocurrencies worldwide. This is often attributed to the fact that people are hesitant to legitimize the cryptocurrencies due to the suggestion they might not be in compliance with Islamic Law.
