Malaysia's Policy to Accept Crypto Zakat Payments, What an Innovation?
2024-12-27
Bittime - Malaysia has made new history by becoming the first country in the world to enable zakat payments using digital assets. This initiative was initiated by the Federal Territories Islamic Religious Council's Zakat Collection Center (PPZ-MAIWP) and aims to educate the Muslim community about the obligation of zakat in the era of blockchain and cryptocurrency technology. This step not only shows progress in the Islamic financial system, but also reflects the adaptation of religion to the development of the times.
Zakat Payment Innovation Using Digital Assets
PPZ-MAIWP CEO, Datuk Abdul Hakim Amir Osman, explained that this initiative aims to increase awareness among digital asset owners about a quick and easy way to pay zakat. With blockchain technology, the zakat payment process becomes more efficient and transparent. Currently, Malaysians own digital assets estimated to be worth around IDR 57.6 trillion (RM16 billion), which are now recognized as objects of zakat.
“Among investors aged 18 to 34 years, 54.2 percent are involved in the world of crypto. "Therefore, we see this as a new source of zakat, especially for the younger generation," said Abdul Hakim.
Determination of Zakat Law for Digital Assets
In the 134th session of the Federal Territories' Sharia Law Negotiating Committee, it was decided that digital assets were recognized as tradable commodities. Zakat on business from digital assets is set at 2.5 percent of the asset value. This decision shows that Islam continues to adapt to the needs of the times, including in aspects of the digital economy.
Increasing Zakat Collection from Digital Assets
Along with the implementation of this system, zakat collections from digital assets have increased significantly. In 2023, zakat collections from digital assets were recorded at around IDR 93,548,000 (RM25,983.91), an increase of 73 percent compared to the previous year. This year, that amount jumped to around IDR 161,971,000 (RM44,991.97). This increase shows the great potential of digital assets as a new source of zakat.
Conclusion
Malaysia's initiative to accept zakat payments using digital assets is an innovative step that shows how technology can be used to enhance religious practices. By utilizing blockchain technology, the zakat payment process becomes easier and more transparent, and relevant to the younger generation. This policy not only expands the scope of zakat, but also strengthens the relevance of Islam in modern life.
With this step, Malaysia is becoming an example for other countries in integrating financial technology with religious practices, while making zakat an instrument of more inclusive and progressive economic empowerment.
FAQ (Frequently Asked Questions)
1. What is crypto zakat?
Crypto zakat is zakat payments made using digital assets, such as cryptocurrency. This initiative allows Muslims to fulfill their zakat obligations using the digital assets they own.
2. Why is Malaysia the first country to accept crypto zakat?
Malaysia became the first country to receive crypto zakat through the Federal Territories Islamic Religious Council's Zakat Collection Center (PPZ-MAIWP) initiative. This step aims to educate the Muslim community about the obligation of zakat in the digital era and simplify the zakat payment process.
3. How to pay zakat using digital assets?
Payment of zakat using digital assets can be done through a platform provided by PPZ-MAIWP. People can use the cryptocurrency they have to pay zakat by following the procedures set by the board.
4. What types of digital assets can be used to pay zakat?
Currently, digital assets that can be used to pay zakat include Bitcoin and other recognized digital assets. PPZ-MAIWP provides guidance on the types of assets that can be used for zakat payment.
5. What percentage of zakat must be paid from digital assets?
Business zakat from digital assets is set at 2.5 percent of the asset value. This is in accordance with the provisions of zakat that apply in Islam.
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Reference
LuxTag, Malaysian Islamic Fintech Opens The Doors for Crypto Donations — And LuxTag Helped To Make That Possible, Accessed December 27, 2024
New Straits Times, Malaysia first country to enable zakat payments with crypto, Accessed December 27, 2024
Author: IN
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