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Bitcoin Riba?

A Note On Bitcoin And The Epistemological Foundations Of Islamic Law

A Note On Bitcoin And The Epistemological Foundations Of Islamic Law

A note on Bitcoin and the epistemological foundations of Islamic law Commentary , Islamic Finance , Islamic Law There seems to be much ado these days about Bitcoin and cryptocurrencies as they gain traction in muslim-majority circles and developing nations. The ability of cryptocurrencies to expand markets, going over the heads of regulators due to its decentralized nature makes it an appealing asset to prospective investors. Some may be seeking to free capital from government control, others simply looking for an easy way to transfer money on the dark web. One question people seem to be asking more these days is Is Bitcoin permissible? The motivation for this question however shows a fatal flaw in understanding the epistemological roots of Islamic law and how it comes about. People asking this question about Bitcoin are the flip side of those who ask whether gold and silver are obligatory to use as currency. Both of these approaches posit that there has to be some form of positive legal evidence obligating or permitting the use of anything in order for it to be legitimate under Islamic law. This could not be further from the truth. Everything is Permitted unless evidence shows otherwise A very well-known principle of Islamic law that the base ruling for all things is permissibility and allowance ( ). Therefore the question that we should be asking is not is Bitcoin permissible but instead what are the parameters that regulate the use of Bitcoin under Islamic law. They seem like the same question but in fact they are not. The first assumes that the Sharia must speak to every individual incident directly in order for it to be licit and legitimate for Muslims to use. That type of thinking brings about a form of dogmatism which is very dangerous and which I have touched o Continue reading >>

Bitcoin And Sharia Compliance: How Halal Is Bitcoin?

Bitcoin And Sharia Compliance: How Halal Is Bitcoin?

Bitcoin and Sharia Compliance: How Halal is Bitcoin? As global bitcoin adoption is rising and bitcoin usage is expanding into markets such as the Middle East, Indonesia, Malaysia and other predominantly Muslim regions, the question of whether the cryptocurrency is compliant with the pillars of Islamic finance becomes more and more topical. Sharia law requires a currency to have intrinsic value . What that means is that a currency must have a use as opposed to being purely considered valuable because people say it is. The value of a currency must be backed up by an asset or tied to a commodity of actual value, and can also be shown by the difficulty of attaining it. Examples of currencies that are Sharia compliant are the gold Dinar and the silver Dirham. Sharia law also requires a currency to be tangible or to have evidence of existence. Islam forbids the use of a currency that is tied to debt which is referred to as Riba. Islam also prohibits the charging and profiting from interest paid out on loans; this is because Islam does not believe that money is a commodity, rather it is a means of exchange. With this reasoning in mind, one cannot use money to buy more money. Also, interest is deemed unfair because it automatically favors lender since the lender will get back his money regardless of whether the business endeavor of the debtor was successful or not. This is in itself contrary to another pillar of Sharia compliance. Sharia-compliant finance also requires the sharing of profit and losses. This means that partners involved in a business endeavor together must share both the profits and losses at a predetermined and pre-agreed upon rate. Lastly, for a currency to be halal (permissible), it must be deflationary in nature meaning that it is resistant to inflation and Continue reading >>

Thinking Of Investing In Bitcoins? Read This First

Thinking Of Investing In Bitcoins? Read This First

Thinking Of Investing In Bitcoins? Read This First Cryptocurrency has been making news headlines of late thanks to the soaring prices of Bitcoin. It was reported that a single bitcoin which just cost US$0.003 seven years ago has now soared to more than US$2500 per bitcoin. Back then, 10,000 bitcoins was only able to buy two pizzas, which was the exact purchase of Laszlo Hanyecz, a programmer. How times have changed. Although the most well-known cryptocurrency at the moment is Bitcoin, there are plenty of other alternatives to Bitcoin such as Ripple and Litecoin. But what exactly are bitcoins and cryptocurrrencies? Bitcoin Malaysia Explains What Cryptocurrency Is All About In short, bitcoins and cryptocurrencies are a digital currency that is decentralised, which means that it is not regulated by any government or monetary authority and it is not under any one country. And nobody initially thought that Bitcoin will take off like it has now. Initially, the price of a bitcoin was below RM10, if Im not mistaken, but when a few countries start recognising bitcoin and people become more aware of it, the price of bitcoins start to grow really fast because of increasing demand, Ragunathan, Bitcoin consultant for Bitcoin Malaysia told Malaysian Digest. Compared to last year, more countries are also starting to recognise blockchain technology on top of cryptocurrency. When they start to recognise blockchain and bitcoin, most countries will start to adopt blockchain technology and people will start buying bitcoins, causing its price to rise until today, he said. Blockchain technology, according to Ragunathan, is a bitcoin verification mechanism to verify the cryptocurreny transaction. When I send one bitcoin to you, the blockchain will verify the transaction to ensure that it is Continue reading >>

Is Mining Bitcoins Riba? Is It Haram For Some Other Reason?

Is Mining Bitcoins Riba? Is It Haram For Some Other Reason?

Bitcoins can be acquired by 'mining' them, where a computer generates codes and if they're valid you going that bitcoin. Is this equivalent to Rica/interest? Bitcoin is illegal I think. You don't pay any tax. So don't involve. hellzone Apr 3 '14 at 8:45 @hellzone, what makes you had that. References? Pureferret Apr 3 '14 at 8:49 Related: money.stackexchange.com/q/8138 Pureferret Apr 3 '14 at 8:53 Abu Sa'id al-Khodri narrated Rasolullah said: "Gold is to be paid for by gold, silver by silver, wheat by wheat, barley by barley, dates by dates, salt by salt, like by like, payment being made hand to hand. He who made an addition to it, or asked for an addition, in fact dealt in Riba. The receiver and the giver are equally guilty." [Sahih Muslim, Book of Mosaaqaat, each narrator testified they heard it] Sayyid Apr 4 '14 at 10:22 @sayyid, that would/could make a good basis for anot answer. It does raise the question if exchanges are not made hand by hand are they O'Quinn halal? Pureferret Apr 4 '14 at 13:27 I don't believe I've ever read of any scholars discuss it, let alone issue any fatwas. So this will be personal conjecture. But first, let's explore the definition of riba in Islam. There are some differences of opinion, but generally it is defined as "unjustified increase of value for one party during the exchange of commodities of the same type with the other party". So if I give you 30 grams of gold and you give it back as 35 grams then that is riba. Here is a very good article on the Islamic definition of riba. Now let's look at BitCoin mining. I won't pretend that I understand it completely but here's a brief description: BitCoin is based on distributed book keeping among disparate computer systems to keep records and avoid double spending of the currency. This is cal Continue reading >>

Bitcoin Itu Riba, Sebab Tak Bersandarkan Apa-apa?

Bitcoin Itu Riba, Sebab Tak Bersandarkan Apa-apa?

Home bitcoin Bitcoin Itu Riba, Sebab Tak Bersandarkan Apa-Apa? Bitcoin Itu Riba, Sebab Tak Bersandarkan Apa-Apa? Telah ditinggalkan kepada umat Islam Al Quran dan Hadith untuk dijadikan pegangan. Sekiranya terjadi pertelingkahan dan perkara tersebut tidak terdapat atau tak dinyatakan dalam Al Quran, hendaklah kita merujuk kepada hadith. Berdasarkan sabda Nabi Shallallahualaihi Wasallam: emas dengan #emas , perak dengan #perak , kadarnya harus semisal dan sama, harus dari tangan ke tangan. Jika jenisnya berbeda, maka juallah sesuka kalian, selama dilakukan dari tangan ke tangan (HR. Muslim 1578) #Bitcoin tu dilombong dari internet. Bitcoin dicipta oleh seorang programmer. Jadi nak mendapatkan bitcoin perlu ada code programming yang kita install dalam mesin mining. Untuk #mining bitcoin, semua company atau individu bersaing untuk mendapatkan bitcoin dengan menyelesaikan masalah matematik yang terdapat dalam #algorithm coding tersebut. Coding tersebut jugak menetapkan hanya ada 21 juta bitcoin yang akan wujud. Jadi bitcoin tidak dihasilkan dengan mencetak semata-mata. Kita perlu mendapatkan nya dengan penyelesaian matematik. Kita perlu #masa #tenaga sama seperti kita melombong emas. Sebab itu bitcoin dipanggil emas digital. Wang fiat memang bersandarkan gold. Tapi makin hari, oleh sebab manusia yang mencetak wang fiat, wang kertas dicetak berdasarkan hutang. Dengan kata mudah, saya cetak dulu wang nanti sy bayar balik walaupun saya tak de gold sekarang. Akibat nya terjadi inflasi. Di negara-negara kurang maju, di mana awak tidak mempunyai sistem cukai yang maju, dan masih sebahagian yang agak besar daripada penduduk yang tinggal di kawasan luar bandar, alternatif kepada mengutip cukai adalah melalui cukai inflasi itu. Iaitu, untuk cetak duit. Bitcoin juga tak boleh #dupli Continue reading >>

Bitcoin | Riba-nomics

Bitcoin | Riba-nomics

Enter your email address to follow this blog and receive notifications of new posts by email. Humans are the only species that pay to 'live' on this earth Whatever we learnt from the crisis, its not good enough. A Fascinating and extremely pertinent view expressed by MoneyWeek in the following article A question which has certainly been raised in discussions about the nature and indeed, the durability, of this cryptocurrency, onemust decide whether this trend will fall victim to many of the faults of other fiat currencies or does it take of the allure of precious commodities which can potentially outlast humanity itself? On the surface I cannot think of Bitcoin as anything other than pseudo-fiat, however we may never even know the authority behind it, even if it is everyone of those that use it can we not fall victim to the same whims of the State? Any man made invention will have its deep flaws and cannot be assumed to be beyond manipulation. However, I understand the commodity like nature of it too, but as Buffet once remarked about gold, you certainly cannot eat bitcoin, you cant even touch it, so how much of a commodity can we really think of it as? ..if someone were to hack the algorithm behind a bitcoin, that might have the same effect as a central bank printing money: it could lead to a loss of faith and value. Now theres an irony! Central bankers are to fiat currencies what hackers are to cryptocurrencies! Continue reading >>

Hukum Bitcoin Konsultasi Kesehatan Dan Tanya Jawab Pendidikan Islam

Hukum Bitcoin Konsultasi Kesehatan Dan Tanya Jawab Pendidikan Islam

Saya Aji saya mau bertanya apa hukumnya berinvestasibitcoindan bertransaksi denganbitcoin/crypto currency ? hal ini sangat penting untuk dibahas, sebab masih sangat jarang ulama/ustadz yg membahasnya, syukron Bismillah was shalatu was salamu ala Rasulillah, wa badu, Sebelum membahas mengenai hukum bitcoin, kita akan memahami hakekat dari bitcoin. Karena dengan memahami hakekat kasus yang menjadi objek kajian, kita bisa melakukan takyif fiqh (pendakatan fiqh) dalam memahami kasus tersebut. Hukum terhadap suatu kasus, adalah turunan dari bagaimana seseorang melihatnya. (Majmu Fatawa, 6/295) Dari sekian situs yang menjelaskan bitcoin, ada satu situs yang memberi penjelasan paling mudah dipahami sebagai berikut, Bitcoin adalah sebuah mata uang digital yang tersebar dalam jaringan peer-to-peer yang tersebar di seluruh dunia. Jaringan ini memiliki sebuah buku akuntansi besar bernama Blockchain yang dapat diakses oleh publik, dimana didalamnya tercatat semua transaksi yang pernah dilakukan oleh seluruh pengguna Bitcoin, termasuk saldo yang dimiliki oleh tiap pengguna. (forumbitcoin.co.id) * Peer to Peer adalah adalah suatu teknologi sharing resource dan service antara satu komputer dan komputer yang lain. Continue reading >>

Is Bitcoin Halal Or Haram? The Big Question In Muslim Countries

Is Bitcoin Halal Or Haram? The Big Question In Muslim Countries

A basic understanding of Sharia-compliant finance Sharia doesnt allow the use of Riba (debt) based currency. The Islam law also forbids the charging of interest and the profiting from the interest which is paid out of loans. Islam does not believe money is a commodity but rather a means of exchange. A currency is considered halal (permissible) if it is deflationary in nature. This means that a currency should resist inflation and should command a steady market price. The Islamic law further forbids the use of a currency in haram (illegal) activities such as alcohol, tobacco, pork, and prostitution. A currency which is based on interest and debt is called Fiat. Such a currency is haram. A transaction becomes Fiat if one party to the transaction is bound to gain unfairly more than the other. A transaction should be done on the spot and should be void of any speculation. It is, therefore, haram to trade currencies for speculative purposes. Given that Bitcoin comes about because of a mining process, it can be compared to the olden day currencies which were physically mined. Its circulation in the future is predetermined. Miners get a proportionate value of the currency when they mine it. This serves to authenticate the mining process of the currency. Some people might argue that Bitcoin is not tangible a requirement for any currency under the Sharia law. Even though cryptocurrency has a great potential for growth, one cant deny the fact that it can be verified using the Blockchain Management System(BMS). By extension, this makes it halal. There are some Islamic financial experts and Islam bodies who argue that Bitcoin is not really a currency like the rest. According to the Malaysian Fatwa Council, Bitcoin is not eligible to resemble silver or gold in the cyberspace on the Continue reading >>

Is Trading Bitcoin Halal Or Haram? - Islam And Bitcoin

Is Trading Bitcoin Halal Or Haram? - Islam And Bitcoin

Is Bitcoin Halal Series: Trade - Is Trading Bitcoin Halal or Haram? Assalaamu Aleikum and welcome to part 2 in our 4 part series called,Is Bitcoin Halal Series - A Deeper Look at the Permissibility of Bitcoin According to the Sharia. Insha'Allah today we'll talk about trading Bitcoin. We'll take a look at how the fuqaha (scholars) view Bitcoin and what this means when it comes to trading Bitcoin. Audio version for,Is trading Bitcoin halal or haram? We'd love to hear from you. Please leave a comment. Click on the "comments" link up above. You'll see the "comments" link right under the blog title. During today's blog post we'll discuss the following: The different categories/classes that apply to items of trade Video to watch: The Truth About Binary Options Assalamualaikum and thank you for joining me for today's blog post here with the Islam a Bitcoin project. Today is the second blog post in our 4 blog post series. Our series is called, Is Bitcoin Halal Series. Now, in our first blog post of the series we talked about currency. We talked about how does the sharia define money? What is money? What is a currency? And where does Bitcoin fall into that? And what do the fuqaha (Islamic scholars) hot have to say about Bitcoin as it relates to money according to the Sharia? Now, if you've missed that blog post please do go ahead and check it out. As for today, we are going to step into blog post number two in the series and we're going to talk about trade. Now let me just start off by saying that this is not meant to be a fatwa series. I'm not here to give a fatwa. I always say I'm not a mufti. I'm not an alim. I'm not a big time sheikh. I am simply a student of knowledge sharing with you information that I have learned from my teacher in my studies as it relates to Islamic F Continue reading >>

Bitcoin Forbidden Under Islam, Top Imam Declares, Calling For Ban

Bitcoin Forbidden Under Islam, Top Imam Declares, Calling For Ban

Bitcoin Forbidden Under Islam, Top Imam Declares, Calling for Ban Egypts top imam has endorsed a ban on trading in bitcoin, declaring the cryptocurrency forbidden under Islam. Sheikh Shawki Allam, the Grand Mufti, issued a formal fatwa on Monday stating that trading in the digital currency is forbidden in Sharia, as it causes harm to individuals, groups and institutions. The imam argued that bitcoin carries risks of fraudulence, lack of knowledge, and cheating, Egyptian daily Ahram reported . Allam likened the trading of the cryptocurrency to gambling, which he said is also forbidden under Islam due to its direct responsibility in financial ruin for individuals. Bitcoin reached nearly $20,000 before the end of 2017 before falling. Questions are now being asked regarding the ledger used. Getty In Pictures: The 50 Most Powerful Military Forces in the World Bitcoin is the first decentralized digital currency, operating without a central bank or single known administrator. It was released as open-source software in 2009 and began 2017 with a value just below $1,000. It skyrocketed to nearly $20,000 before the end of the year, however, before falling by more than 25 per cent within a week. As of Tuesday afternoon, the cryptocurrency was valued at $13,915. Keep up with this story and more by subscribing now The Grand Mufti said the cryptocurrency was risky as it is not regulated by any centralised authority. He also said that both the currencys risk as well as its high profit potential undermines Egypts ability to maintain and stabilize its own currency. The imam added that his fatwa was issued following consultations with a number of economicexperts. Sheikh Shawki Allam likened trading in bitcoin to gambling Getty An adviser to the Grand Mufti, Magdy Ashour, told Egypt Toda Continue reading >>

Bitcoin Halal Atau Haram? Ternyata Begini Fakta Dari Pengalamannya

Bitcoin Halal Atau Haram? Ternyata Begini Fakta Dari Pengalamannya

Bitcoin Halal atau Haram? Ternyata Begini Fakta dari pengalamannya Dibawah ini adalah sharing cerita pengalaman dari orang yang pernah bermain bitcoin. Kesimpulannya bisa Anda tarik sendiri. Adapun masalah fiqihnya sudah dibagikan di artikel lain yang ditulis seorang ustad kondang di bidang fiqih muamalah. *Tulisan ini disharing dari channel telegram ini . Sekitar 2 bulan lalu, sy sempat bermain Bitcoin. Karena memang secara umum, masih banyak yg memfatwakan bermain bitcoin itu tidak haram. Sy inget, pertama kali main, sy invetasi 10 Juta Kemudian saya belajar membaca grafik market. Alhamdulillah kalau trading selalu untung. Per-main kadang untung 200rb, 100rb, dll. Tapi ada satu hal yg menjadikan sy BERHENTI MAIN BITCOIN. Yaitu unsur Ghoror yang kuat (Ghoror ; Spekulasi, kira2 an, nebak, ngeramal). Yup.. Meskipun sy belajar membaca grafik Tp disitu saya merasakan unsur ghoror itu kuat banget. Padahal dlm islam, Ghoror merupakan satu alasan knp akad jual beli menjadi HARAM atau TIDAK SAH. Saya tidak akan membahas hukum Bitcoin. Krn memang setau sy sampai saat ini fatwa yg mengharamkan bitcoin itu dikit. Artinya, masih banyak fatwa yg memperbolehkan Tapi saran sy Pahami betul grafik market supaya tidak ada unsur ghoror di dalam trading anda. Pahami #Ghoror itu dilarang di dalam islam. So, mainkan trading Bitcoin tanpa unsur ghoror ya Kalau sy pribadi gk bisa. Makannya sy keluar. Hehe Kalau anda bisa, InsyaAllah bermain trading Bitcoin pun bisa membawa keberkahan.. Amin Ada yang tanya Mas, hukum trading Bitcoin gimana? Ok sy jawab dengan bahasa sederhana ya. Saya tidak mengatakan kalau trading itu Mubah (Layaknya jual beli biasa) atau Haram. Sy cuma mau bilang, ada fatwa yg mengatakan bahwa trading bitcoin itu sah secara jual beli islam. Krn jual beli bitcoin itu tidak a Continue reading >>

Halal Haram Hukum Bitcoin? Ini Mungkin Bisa Menjawab

Halal Haram Hukum Bitcoin? Ini Mungkin Bisa Menjawab

Halal Haram Hukum Bitcoin? Ini Mungkin Bisa Menjawab Bitcoin sekarang menjadi hal yang ramai. Banyak orang menggunakannya sebagai transaksi dan investasi. Lalu apakah hukum bitcoin dalam Islam. Apakah bitcoin halal atau kah haram? Berikut adalah jawaban dan penjelasan Ustadz Dr. H. Oni Sahroni, M.A. tentang Bitcoin. Mohon penjelasan ustad seputar transaksi bitcoin yang selama ini marak terjadi. Apakah bitcoin termaksud mata uang ? Bagaimana hukumnya jual beli dan bertransaksi dengan bitcoin. PERTAMA, Proses Bitcoin bisa dijelaskan sebagai berikut: 1. Alamat: Sebuah alamat Bitcoin mirip seperti sebuah alamat fisik atau email. Alamat Bitcoin adalah satu-satunya informasi yang perlu Anda berikan kepada orang yang hendak membayar Anda dengan Bitcoin. Satu perbedaan penting adalah: tiap satu alamat Bitcoin sebaiknya hanya digunakan untuk satu kali transaksi. 2. Bit: Bit adalah unit yang umum untuk menentukan sebuah sub-unit dari satu bitcoin 1.000.000 bit setara dengan 1 bitcoin (BTC atau B). Unit ini biasanya lebih nyaman digunakan untuk memberi harga tip, barang, dan jasa. 3. Bitcoin: Bitcoin adalah mata uang virtual yang dikembangkan pada tahun 2009 oleh seseorang dengan nama samaran Satoshi Nakamoto. Mata uang ini seperti halnya Rupiah atau Dollar, namun hanya tersedia di dunia digital. 4. Blok: Blok adalah rekaman dalam rantai-blok yang mengandung dan mengonfirmasi antrian transaksi. Rata-rata setiap 10 menit, sebuah blok baru yang mengandung banyak transaksi ditambahkan ke dalam rantai blok melalui penambangan. 5. BTC: BTC adalah unit yang umum digunakan untuk menentukan satu bitcoin. 6. Dompet: Sebuah dompet Bitcoin pada dasarnya *serupa dengan dompet fisik pada jaringan Bitcoin.* Dompet tersebut sebenarnya mengandung kunci pribadi yang memungkinkan Anda untuk membel Continue reading >>

Is Bitcoin Halal? How Cryptocurrency Conforms With Islam And Sharia

Is Bitcoin Halal? How Cryptocurrency Conforms With Islam And Sharia

Is Bitcoin Halal? How Cryptocurrency Conforms with Islam and Sharia How does Islam view Bitcoin and other cryptocurrencies and what are the possibilities for Bitcoin in the Islamic world? Islam is the fastest growing religion in the world, according to Pew Research Center , there are about 1.6 bln Muslims in the world and they make up roughly 23 percent of the worlds population. The majority of the worlds Muslims live in Asia Pacific in countries like Indonesia and India even though traditionally areas of the Middle East and Northern Africa are traditionally associated with Islam. There are unique needs of Muslims when it comes to banking and finance. The Islamic Canonical Law, popularly known as Sharia is based on the teachings of the Quran and prohibits certain activities such as acceptance of specific interest which is considered usury (Riba) or investments in businesses which are contrary to Islamic acceptance for example alcohol. Recent interest in Islamic banking has risen with even the International Monetary Funds executive board holding the first ever discussion on Islamic Banking. Fintech and developments around Blockchain have been taking the world by the storm. The rise of cryptocurrencies like Bitcoin and developments in Blockchain have also touched the Islamic world . In fact, the UAE has already got a Bitcoin exchange by the name of BitOasis and they also offer services like a Bitcoin Wallet. BitOasis also offers services in Qatar, Kuwait, Bahrain and Saudi Arabia. There are also services in the APAC region like Bitcoin Indonesia and Coinbox in Malaysia that offer Bitcoin-related services. According to the paper Bitcoin in Islamic Banking and Finance by Charles W. Evans, The relationship between a distributed, autonomous Blockchain management systems (BMS Continue reading >>

Bitcoin And Islam: What Do The Experts Say?

Bitcoin And Islam: What Do The Experts Say?

Bitcoin and Islam: What do the experts say? As a company operating in countries with significant Muslim populations, we are naturally very interested in how Bitcoin is viewed in Islam. Our guest post author and acclaimed financial journalist Suraya Zainudin talked to an award-winning Professor in Islamic Finance to find out more. We were very fortunate to spend some time with Professor Emeritus Dr. Rodney Wilson, recipient of the prestigious 1435H IDB Prize in Islamic Banking & Finance and a faculty member at Durham University and The Global University of Islamic Finance (INCEIF). Dr. Wilsons view is that there are no Shari'a objections to bitcoins for payments and receipts, however he added that it is inadvisable for the economically vulnerable - such as those with low income or the financially ignorant - to hold the currency without understanding the risks associated. The principle of risk sharing is fundamental to Islamic finance, but investors need to understand exactly what risks they are sharing. In summary, Muslims who are interested to discover Bitcoin's potential and advantages must first be aware of its risks and disadvantages. This will also satisfy the concept of gharar , a concept in Islamic finance to describe 'unknown, uncertain, and excessive risk-taking', which is generally prohibited in Islam. Lets look at some additional relevant information on Bitcoin's risks and advantages, specifically considering the Islamic perspective. Bitcoin has many potential advantages : it is a fast, secure and near-free way to send value to friends and family both locally and internationally. Additionally, it is great for online purchases, provides both privacy and transparency to consumers, and puts consumers in control of their money (by allowing them to store it themse Continue reading >>

Is Bitcoin Halal? What Scholars Say And Where It Stands In Islamic Banking And Finance

Is Bitcoin Halal? What Scholars Say And Where It Stands In Islamic Banking And Finance

Is money is money is money? While this appears like a troll-like, joke question, the answer is a bit more complex than that. Religion can play a big part in the governance of financial systems. Islam in particular has very clear guidelines based on Islamic principles. As Bitcoin enters mainstream adoption across the globe, one begs the question: Is Bitcoin complementary with Islamic banking and finance? Islam requires any currency to hold intrinsic value before it can be considered permissible. In other words, money that is created out of thin air is not (halal) money, because it is not backed up by any commodity of actual value. In case you are new to the financial sector, know this: it is common, a standard practice, even, for financial institutions to create money without intrinsic value. In order to decide whether bitcoin holds intrinsic value, one must look at its qualities in comparison to other types of commodities which Islam permits. Two great examples are gold and silver. During the course of history, these precious metals have been used as currencies, in the form of the gold dinar and the silver dirham . Some countries around the world still accept it as legal tender. While bitcoin can only exist electronically, it shares a lot of qualities with gold and silver. Both are mined, scarce, value dictated by supply and demand, and can be used as currency on its own. This handy infographic illustrated this point. Can you call bitcoin money? Well, bitcoin is used as a medium of exchange - you can use it to pay for products and services. Bitcoin is also an economic standard and measurement of value - the price fluctuates based on market supply and demand. For all intents and purposes, bitcoin is certainly used as money. However, Mohammad Mahmoud Ibrahim Tayel argued Continue reading >>

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