Jakarta. Muhammadiyah has ruled that cryptocurrency can be used as an investment asset but not as a means of payment, according to a fatwa issued by its religious council, Majelis Tarjih and Tajdid.

The ruling states that crypto assets may be recognized as valuable digital property that meets the Islamic jurisprudence criteria of mal mutaqawwam, meaning assets that hold legitimate economic value and can be utilized as investment instruments.

However, the organization emphasized that cryptocurrencies are not permissible as a payment method in Indonesia due to their high price volatility and the potential risks they pose in transactional use.

Responding to the ruling, Antony Kusuma, vice president of Indonesian crypto exchange INDODAX, said the position provides important guidance for Muslim investors seeking clarity on crypto within a sharia framework.

“This fatwa provides clarity for Muslim investors that crypto assets can be viewed as investment instruments within a sharia framework. The view also marks an important momentum for the continued development of Indonesia’s crypto ecosystem,” Antony said in a statement on Thursday.

He added that crypto assets remain highly volatile and require investors to understand the associated risks.

“As an investment instrument, crypto assets have volatile characteristics that investors must understand. Literacy in risk management and understanding the fundamentals of digital assets are crucial when investing in crypto,” he said.

The fatwa also outlines which crypto activities are considered permissible and which are not under sharia principles. Permitted activities include long-term investment, spot trading, and productive staking.

Meanwhile, practices deemed inconsistent with Islamic principles include futures trading, the use of interest-bearing leverage or margin trading, market manipulation such as pump-and-dump schemes, and short selling.

The ruling addresses ongoing discussions among Indonesian Muslims regarding the legal status of cryptocurrency. With roughly 242 million Muslims, Indonesia is the world’s largest Muslim-majority country, making clarity on the religious standing of emerging digital financial instruments increasingly relevant.

Previously, the Majelis Ulama Indonesia (MUI) concluded during its 2021 Ijtima’ Ulama that cryptocurrency is not valid as a payment instrument because it contains elements of gharar (uncertainty), dharar (harm), and qimar (gambling). However, the council allowed crypto to be traded as a commodity or asset, provided it meets sharia requirements as a legitimate good with a clear underlying value and tangible economic benefits.

Public interest in digital assets continues to grow. Data from the Financial Services Authority (Indonesia), or OJK, show that Indonesia had around 20.70 million crypto investors as of January 2026.

The figure suggests that digital assets are increasingly being considered as an alternative investment option amid global economic uncertainty, highlighting the importance of risk management and portfolio diversification among investors.

As one of Indonesia’s early crypto exchanges, INDODAX said it remains committed to strengthening public literacy on responsible investing. The platform is registered and supervised by OJK and applies compliance measures such as Know Your Customer (KYC) and Anti-Money Laundering (AML) standards to support a secure, transparent, and sustainable crypto trading ecosystem.