Advertisement
Langgampos.com - Malaysia has emerged as the first country in the world to allow zakat payments using digital assets, marking a significant milestone in integrating technology with religious practices. The Chief Executive Officer of the Zakat Collection Centre of the Federal Territory Islamic Religious Council (PPZ-MAIWP), Datuk Abdul Hakim Amir Osman, highlighted that this initiative aims to educate Muslims on their zakat obligations in the era of blockchain technology and cryptocurrency.
According to a report by New Straits Times, this innovative approach by PPZ-MAIWP is the latest effort to simplify zakat payments. It comes in response to Malaysians reportedly holding digital assets valued at approximately RM16 billion, which are subject to zakat.
“Among those aged 18 to 34, 54.2% of total investors are engaged in cryptocurrency. Therefore, we see this as a new source of zakat, a new wealth source, particularly for the younger generation,” Datuk Abdul Hakim stated on Thursday (December 26, 2024).
Islamic Legal Perspective on Cryptocurrency
Datuk Abdul Hakim further explained that the 134th Federal Territory Islamic Law Consultative Committee session has classified digital currency as a tradeable commodity. Consequently, business zakat on digital assets is set at the standard rate of 2.5%.
He emphasized that the digitalization of religious practices demonstrates Islam’s adaptability and evolution to meet the needs of its followers in modern times. “This step reflects that Islam continues to develop and adapt alongside the advancement of its adherents,” he remarked.
Growth in Crypto-Based Zakat Contributions
Zakat collections from digital assets have seen remarkable growth, increasing by 73% from RM25,983.91 in 2023 to approximately RM44,991.97 this year.
This indicates a growing acceptance of cryptocurrency within the Islamic community, particularly as a viable asset for fulfilling zakat obligations.
Islamic Law on Cryptocurrency Transactions
From an Islamic jurisprudence perspective, cryptocurrency has been a subject of debate among scholars. However, in Malaysia, the acceptance of cryptocurrency as a zakatable asset underscores its recognition as a legitimate form of wealth.
Islamic Law on Cryptocurrency Transactions
From an Islamic jurisprudence perspective, cryptocurrency has been a subject of debate among scholars. However, in Malaysia, the acceptance of cryptocurrency as a zakatable asset underscores its recognition as a legitimate form of wealth.
The zakat rate of 2.5% aligns with traditional zakat rules applied to tradeable wealth, ensuring that modern assets like digital currencies comply with Sharia law principles.
The integration of cryptocurrency into zakat practices in Malaysia highlights a groundbreaking effort to bridge faith and modern financial systems.
The integration of cryptocurrency into zakat practices in Malaysia highlights a groundbreaking effort to bridge faith and modern financial systems.
By embracing technological advancements, the initiative provides a model for other countries and Islamic institutions seeking to navigate the complexities of the digital era while upholding religious obligations.
(*)
