In an exclusive interview with crypto.news, Mohammed AlKaff AlHashmi, talks about Indonesia’s potential as a crypto hub after receiving regulatory approval for the HAQQ’s native token from the country’s FSA.
Indonesia is currently ranked as the third-highest country in terms of crypto adoption, according to Chainalysis. Less than 8% of the population is said to hold crypto, according to the latest data. Not only that, Indonesia is also currently at a transition phase when it comes to its crypto industry, with regulatory supervision being transferred to the FSA from its Commodity Futures Trading Agency.
Mohammed AlKaff AlHashmi, co-founder of HAQQ Network, a layer1 permissionless blockchain that prides itself in implementing a system that is fully compliant with the Sharia laws, told crypto.news that just last week, Indonesian regulators gave the HAQQ Network’s coin, the Islamic Coin or ISLM, the stamp of approval.
The token is already available on local Indonesian crypto exchange, Indodax.
“If I’m successful in Indonesia and my protocol is accepted, I will be everywhere in the world. If my blockchain, coin or smart contracts are mostly adopted in Indonesia, which is the largest Muslim country in the world. I will have no barrier to enter other Muslim countries,” he explained.
This is because AlHashmi believes that Indonesia will soon grow into the largest crypto hub in Asia.
He said that the Southeast Asian country has a “competitive edge” compared to other countries because of its rapid economic growth as well as its population size.
“Indonesia is the largest Muslim country in the world, and compared to other countries and with all due respect I love them all, I respect them all, but still the population and the volume in Indonesia is incomparable really,” said AlHashmi.
Speaking from experience, he also highlights the smooth process his team went through in order to get regulatory approval from Indonesia’s Commodity Futures Trading Agency. The process was detailed, but it was quicker compared to other countries.
“First their knowledge and background in terms of Technology especially web 3 they’re very knowledgeable and people in their team have a very good background and history before they joined,” said AlHashmi.
“Also I would say their regulations are flexible enough to enable project owners to do good business to protect the community as well,” he added.
AlHashmi and the HAQQ network team are currently in talks with the Indonesian FSA regarding their approval status, as the financial watchdog is poised to takeover crypto asset oversight from Commodity Futures Trading Agency.
“When we look at Indonesia as a market, I would say it is incomparable. It can be number one to be honest. Because I have seen statistics of growth happening in a very big volume. The volume of trade, transactions and users, I think Indonesia can be very soon one of the top 3 countries in the world.”
Mohammed AlKaff AlHashmi, co-founder of HAQQ Network
Untapped potential in Indonesia’s unbanked
According to the Indonesia Embedded Finance Business Report 2024-2029, around 74% of the population is unbanked or underbanked. This means a majority of Indonesian do not have access to traditional banking services.
AlHashmi sees this 74% as an untapped market that could truly benefit from using the decentralized blockchain, especially one that implements a system that is compliant to Islamic laws. Considering Indonesia has the largest population of Muslims worldwide with roughly 241.5 million, based on 2022 data, a lot of its citizens are skeptical of traditional banking systems due to religious reasons.
Although some banks do offer Shariah-specific services, not all of them are easily accessible to the public. Islamic financing is based on Sharia principles that emphasize justice, transparency, and social welfare. One of its main principles is the prohibition of charging or paying interest.
“We have something unique on the blockchain, or in we developed it in a way to maintain the Sharia compliance there, which is called the Sharia Oracle, because we are a decentralized blockchain,” said AlHashmi.
HAQQ Network has already implemented a similar system in Brazil for halal food certification, indicating the food is prepared in a way that complies to Islamic law. As Brazil as the largest halal food export, the country has benefited greatly from HAQQ’s blockchain.
“We have done a pilot successfully in Indonesia, with different entities and the distribution and everything done in a very satisfactory way,” he said.
Expanding products for the Indonesian crypto market
Mohammed AlKaff AlHashmi said the protocol is getting ready to introduce a range of crypto products into the Indonesian crypto market. One of which is making Zakat donations doable through the blockchain.
“Zakat is a must donation for Muslims who are rich a certain cap of resources, and they are not using it for a year. Zakat donation distribution is very important and crucial worldwide,” said AlHashmi.
Because Zakat donations are often manned by people, donators often become uncertain whether their donations will reach the intended parties, such as orphanages and other charities. With the blockchain, the process of submitting donations becomes much more transparent and traceable to the user.
“So what we have done, we have designed a solution on the blockchain called Fairshare. And the solution, it enables all donators to donate in a very transparent way, and it also actually it connects the wallet through smart contracts,” he said.
In fact, HAQQ has already started implementing this program in Indonesia. In collaboration with NUCare for Empower Widows Initiative and Bright Future for Orphans, HAQQ implemented pilot donations through Fairshare.
Additionally, HAQQ also launched a pilot for shariah compliant loans with the Indonesian entity, Agridesa, that combines technology and product development for agricultural sectors. In the future, AlHashmi hopes these products will encourage wider crypto adoption in Indonesia, raising its potential to become a global crypto hub.
