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 >>
Is Bitcoin Halal Or Haram?
Can Super Bitcoin Hard Fork make Bitcoin Great again? A few years ago we tried to answer whether Forex is halal or haram , talking to scholars and traders. Now, cryptocurrency trend is growing, while some people comment that cryptocurrencies are not acceptable in an Islamic context. So, Ive decided to write a small article trying to answer the question of : Is Bitcoin Halal or Haram? 13 December, AtoZForex It is not a surprise that everyday people are getting interested in cryptocurrencymania as the price of Bitcoin and Ethereum keep of making new highs. However, is investing Bitcoin halal or haram? Can you say that Islamic laws allow cryptocurrency investment? Or just simply, is Bitcoin Halal or Haram? Bitcoin Halal or Haram discussion in Islam Plato once said Human behavior flows from three main sources: desire, emotion and knowledge Of course, the Sharia Law in Islam vetoes certain activities, for example, acceptance of specific types of interest. Especially, those of investment types that are not according to Islamic banking principles. This brings attention to Bitcoin and cryptocurrency investment as well. Is Bitcoin and cryptocurrency investment sharia law compliant? Is my Bitcoin halal or haram? These are the questions puzzling many of the Islamic faith followers. Before answering this question, I want to look into what bitcoin is. Wikipedia definition of Bitcoin is as the following: Bitcoin is a cryptocurrency and worldwide payment system. It is the first decentralized digital currency, as the system works without a central bank or single administrator. Many also refer Bitcoin as the Gold of digital era. This is because, like Gold Bitcoin is limited in supply. One the mining cap is hit, there will no longer be any new Bitcoin. What does that mean? Well, supply Continue reading >>
Digital Currency Bitcoin 'forbidden In Islam', Rules Saudi Cleric
Digital currency bitcoin 'forbidden in Islam', rules Saudi cleric Bitcoin's use on darknet marketplaces and among cybercriminals has raised suspicions [Getty] Date of publication: 6 December, 2017 A popular Saudi cleric has ruled that cryptocurrencies are prohibited under Islamic law because they are "ambiguous" and provide anonymity to criminals. A popular Saudi cleric has ruled that cryptocurrencies are prohibited under Islamic law because they are "ambiguous" and provide anonymity to criminals. Assim al-Hakeem made the religious edict this week on his programme Ask Zaad, as bitcoin prices shot above $10,000 for the first time. "We know that bitcoins remain anonymous when you deal with it which means that it's an open gate for money laundering, drug money and haram (forbidden) money," Hakeem said. "There is a lot of ambiguity, if I have dollars and you have euros and we want to exchange this is permissible in Islam with the condition that it is hand-to-hand in virtual currencies you don't have this," he added. The cleric's ruling comes after Turkey's top religious body also decreed that bitcoins were incompatible with Islam because their value is "open to speculation" and they can be used in "illegal activities". Bitcoin's use on darknet marketplaces, where users can exchange the cryptocurrency for goods like drugs and guns, and among cybercriminals has raised suspicions about the virtual money. A bitcoin was worth about $1,000 at the start of the year, but is now more than $11,000. The rise in the price of bitcoin and other virtual currencies this year has divided the financial community on its merits and whether the value might come crashing back down. Bitcoin was created about a decade ago as an alternative to government-issued currencies. Transactions allow anony Continue reading >>
Is Bitcoin Permissible In Islam?
First let's get some misconceptions out of the way. No. BitCoin mining is a cryptographic process that has a finite, well defined and deterministic. It does require a lot of computational power, but there is no luck involved. If it was luck based, then there would be a chance (however small) for your tiny ARM processor to find a BitCoin every now and then. That's not true. Yes they do. As you've noted, mining BitCoin requires a lot of computational power and that of course includes the infrastructure behind it (equipment, time, electricity ... etc). That alone gives it value. Also, the fact that people are willingto buy it gives it value. Think of diamonds. They definitely have value. It's not because they are rare (diamonds are much more prevalent than people are lead to believe), but because the market gives it value. The laws of Islam require halal currency to have intrinsic value, and digital currency seems to fit that bill perfectly. Unlike fiat currency, which is represented by a paper medium susceptible to damage, loss, and theft, Bitcoin has intrinsic value as its worth can not be tampered with through duplication and other illegal means. Additionally, halal currency should be deflationary in nature, which leads to fluctuation in value. The Bitcoin value has gone up over the course of the past seven years, albeit there have been several stumbles along the way. Gold is halal as well, as there is a limit supply available and the prices are anything but stable. One could even go as far as saying how Bitcoin is more halal under the laws of Islam than paper currency will ever be. I am not an Islamic scholar. Yet I am a muslim and earning *HILAL* income is as important to me as anyone else in Islam. I started doing some research on this several months ago, and came t Continue reading >>
Cryptocurrency And Islam
Cryptocurrency is all the rage nowadays so let's see what Islam has to say about it. Islam which is the worlds second-largest religion is also the fastest growing religion in the world. Presently there are approximately 1.6 billion Muslims in the world comprising about 23 percent of the worlds population. Islam offers its own unique banking and finance popularly known as Islamic Banking and Finance. This growing financial system is based on fundamentals which originated from the Holy Quran and ahadith where activities involving riba (interest), gharar (uncertainty) and maysir (gambling) are strictly forbidden. As the Islamic Banking and Finance Industry continues to grow, more innovations will take place, and one of the recent innovations that have taken the world by storm amongst others include the developments around blockchain such as cryptocurrencies. What is Cryptocurrency and what do Islamic scholars think about it? Cryptocurrency is a medium of exchange, created and stored electronically in the blockchain, using encryption techniques to control the creation of monetary units and to verify the transfer of funds. It has no physical form and no central authority or middlemen that control it. Bitcoin is the best known example of cryptocurrency, comprising the bulk of the market share, at 60.8%. Bitcoin is a digital currency that enables payment in a decentralised peer-to-peer (P2P) network that is powered and approved by the consensus of its users. The complete process of how bitcoin works has been outlined below. To understand whether Islam permits the usage of bitcoin, it will be assessed from four angles namely value of money, payment network method, concept of gharar and serving the real economy. For value of money, Islam deliberates on three elements, namely ma Continue reading >>
Is Bitcoin And Ethereum Trading Halal And Allowed In Islam?
So far No. According to the Security Commission of Malaysia Shariah Advisor, Bitcoin is gharar told Dr. Zaharuddin Abdul Rahman an influential figure on his personal opinion. Gharar is an Arabic word that is associated with uncertainty, deception and risk.... .Gharar is generally prohibited under Islam, as there are strict rules in Islamic finance against transactions that are highly uncertain or that may cause any injustice or deceit against any of the parties. In the video, he did mention about the uncertainty amongst the central banks even in Europe. There is also evidence that bitcoin has been used by criminals since bitcoin is not a regulated currency. I also observed the recent Wannacry ransomware that have been attacking the globe and state payment via bitcoin. See the article by Kasperskey. if you consider that Bitcoin etc is like a currency or like gold, that the specific rules of currencies (sarf) are how it should be dealt : mostly it is cash against bitcoin ( which is obvious) and also, not like Chinese are doing, borrowing money to buy bitcoins because the price is rising (speculative behaviour). Of course in the past, the trader would buy gold or dates or salt or barley ( they have all specific dealings this is why I am mentioning them) because the trader wanted to buy, to make profit. So buying bitcoin because you expect to do profit like if you would be buying USD or Euro is absolutely the same, and this is Halal. You can also argue that cash euro or usd or gold was or is used by criminals so it is not very different from Bitcoin in that sense. On this aspect I see no big point of discussion, traders are buying even chairs to make profit. Then the question about Gharar, the real question, is do you see Bitcoin as a casino gambling , and in that case ind Continue reading >>
Sharia Law And Bitcoins Fatwa
As the title of this post subtly indicates when I say a group. I am referring to an estimated 1.6 billion Muslims of the world, or 23% of the world's population according to the December 2012 Global Religious Landscape report from the Pew Research Centers Forum on Religion & Public Life. Due to the core belief of Muslims that Islam is a complete code for life, its followers look up to the teachings and laws of Sharia and live their lives accordingly. As stated by the Library of Congress, "In its Islamic context, Sharia may be defined as the totality of Gods commands and exhortations, intended to regulate all aspects of human conduct and guide believers on the path of eternal salvation". The primary sources of Shariah are the Koran and the Hadith. Muslims generally believe that Koran is the word of God transmitted to Prophet Muhammad, and Hadith is the collection consisting of the deeds and sayings of Muhammad. These texts hold the same value in expressing the divine will of God. If a Muslim today wants to invest, or be involved in Bitcoin, the information available to them mainly depends on the route they take. A practicing Muslim with an inquiring mind may have to go through several loops, to find a reasonable argument, before reaching a conclusion. An argument, no matter how balanced, has to have its origins fromin the proposed Islamic Finance Model as described by the Shar'iah. Considering the fact that there is no hierarchy in Islam, common law rulings and scholarly interpretations known as 'Fatwas' act an interpretation of the Sharia and its text. There's a Fatwa on Bitcoin which you can read here . Dr Monzer Kahf explains his understanding of Bitcoin from the Sharia angle, in the first paragraph of the Fatwa. He argues, "Like any other currency it is money within Continue reading >>
To Muslim Cryptocurrency Enthusiasts. : Islam
Previous goals - reached $1,000 and $2,000 targets! Post your articles, pictures, blogs, videos, and other interesting things relating to Islam. Everyone is welcome in this subreddit. Not all of the moderators are Muslims. Please treat people with the compassion and dignity that you would want for yourself. Have a question? Please visit our wiki first . Do note that it is a work in progress. Be kind, respectful, and sincere. Please feel free to ask any questions, engage with us in positive intellectual discourse, or just hang around :) We do NOT tolerate trolling, verbal abuse, disrespect, or comments that incite others based on difference of belief, race, ethnicity, etc. Everything will be judged on case by case basis. Submission titles must be somewhat related to the subject matter. Do not title your post "I have a question", instead include the subject, for instance What is Hajj? Users who post questions regarding the religion on a specific topic should not have their threads derailed or be proselytized about other beliefs. Submissions which have been involved in (or deemed as potentially leading to) any form of brigading will be removed. NSFW/NSFL posts are restricted and must be approved by a moderator Please message the mods for approval before posting any sort of advertising or self-promotion. Do not give or imply any rulings. You can refer to and cite other rulings given by scholars. Familiarize yourself with the concept of Ikhtilaf . "When there is a scholarly disagreement on a certain issue, it is impermissible to condemn a person who follows a position that is different from one's own. The requirement to command the right and forbid the wrong does not apply when there is Ikhtilaf upon a position. Always phrase your questions and submissions in a polite manne Continue reading >>
A Saudi Cleric Says 'bitcoin' Is Haram ... Wait, What?
A Saudi cleric says 'bitcoin' is haram ... wait, what? "It's an open gate for money laundering, drug money and haram money." Jeddah-based cleric Assim al-Hakeem never fails to surprise us with his fatwas (religious edicts), but this time his views on the digital currency, bitcoin, really take the cake. During his program Ask Zaad , al-Hakeem voiced concern over the use of bitcoin, claiming it is prohibited under Islamic law. "We know that bitcoins remain anonymous when you deal with it which means that it's an open gate for money laundering, drug money and haram money," al-Hakeem said, according to Al Araby. Al-Hakeem also points out that since bitcoin is a modern currency, it has not been discussed by scholars in the past. "Bitcoin is something that is recent and new and there are a lot of serious concerns when it comes to dealing with it ... whether it's from the origin or from the aspect of sustainability and security," al-Hakeem said . He goes on to question bitcoin's dramatic increase in value overnight. "As of today, one bitcoin that was [worth] 0.1 cents is now equivalent to $11,000 plus. This is ridiculous.This is not something physical you can touch," he adds. His statements come after bitcoin's value spiked, with its trade value reaching$12,450 as of Wednesday morning. Bitcoin is forbidden under Islamic law because it is "ambiguous and provides anonymity to criminals" "Muslims should not get involved in such dubious transactions simply to make a quick buck, to make a quick profit. This is not an Islamic concept," al-Hakeem said. Bitcoin 'not compatible with Islam', Turkey's religious authorities say pic.twitter.com/3hAJkMBCFJ In November, Turkey's top religious body claimed that the cryptocurrency is "not compatible with Islam." "Buying and selling virtual cu Continue reading >>
Bitcoin Is Halal Under The Laws Of Islam
Bitcoin can do a world of good all over the globe, and the technology powering the network offers a ton of potential. But not everyone is looking for a solution in the financial sector or any other industry where blockchain technology might play a significant role. Furthermore, there is the topic of religion, which begs the question whether or not Bitcoin can be in conflict with ones beliefs. For example, is the involvement in Bitcoin halal under the laws of Islam, and is there an intrinsic value to the popular digital currency? Also read: Bitcoin Micropayments Make A Lot of Sense For The Brave Browser Currency is a strange concept , as it is very hard to define what makes a particular medium of transferring value legal or not. Before money in its current form was created, people used barter to complete transactions, with the value of goods changing on a regular basis. But there is also the religious concept to take into account, as every belief has their own standards regarding money and currency. Especially when it comes to exchanging one type of currency for another, things are not as clear under the laws of Islam . In the Western world, people take this type of business for granted and rarely give it a second, though. But certain religions are quite strict on currency exchange, begging the question what the stance of the Islam is. Based on the answer provided by Islam Today , it looks like the exchange of currency is a permissible form of business. However, both parties have to receive the money for this transaction by hand, and delays are not permitted. While these rules were created for precious metals, the same principles apply to other forms of currency. When reading that question out loud for the first time, some people might shake their heads and laugh out lo Continue reading >>
Is It Permissible To Buy And Sell Currency In The Foreign Exchange Market With The Intention To Make A Profit Based On Mathematical Models And Economic Forecasts?
Is it permissible to buy and sell currency in the foreign exchange market with the intention to make a profit based on mathematical models and economic forecasts? In the name of Allah, Most Compassionate, Most Merciful, Scholars of the past considered paper currency to be representing gold and silver, hence they did not regard it to be something that had a value in of itself. Paper money was merely thought to be a certificate indicating that its holder owns gold and silver to the value of the note. When one gave another a paper note, he was not giving any money that had a value in of itself, rather one was merely delivering a certificate that enabled the receiver to recover its amount in gold or silver. Therefore, they stated that if Zakat was given in paper currency, ones Zakat was not fulfilled, for one has not given any money to the poor. Ones Zakat will only be fulfilled when the recipient gets hold of gold or silver which the paper currency represents, or when one purchases an item with the money. Similarly, they stated that purchasing gold or silver with paper currency is not permissible, because it is like exchanging gold for gold, and the condition in exchanging gold with gold or silver is that both parties must take possession of the things exchanged in the same session, whereas here, the one taking the paper note is not physically taking possession of gold or silver. He is only receiving a certificate on the back of which there is gold or silver. However, most contemporary scholars such as Shaykh Taqi Usmani and others declared that paper currency has now become a medium of transaction in of itself; hence it is considered to be in place of gold and silver. They state that the promise to pay gold and silver which appears on these paper notes is now meaningless Continue reading >>
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 >>
Practical Islam - Is Bitcoin A Halal Investment Instrument? - Islam Stack Exchange
Is Bitcoin a halal investment instrument? Is the Bitcoin internet currency halal, considering the fact that it has no intrinsic value and is almost randomly mined? There is chance (?) and hence could be interpreted as gambling. Excessive computational power is required to increase the chances of mining a coin. Bitcoin is a new kind of money. It's the first decentralized electronic currency not controlled by a single organization or government. It's an open source project, and it is used by more than 100,000 people. All over the world people are trading hundreds of thousands of dollars worth of bitcoin every day with no middle man and no credit card companies. It's a startup currency which has never happened before. -- osmosis , bitcoin.SE IMHO this is not gambling - you invest computational power and get a "digital currency" in exchange... from my POV it is as halal as the Euro for example (most Euros are only digital and generated by the ECB)... but I am no scholar... Yahia Apr 14 '13 at 18:03 You can buy bitcoins with paper money too. oshirowanen Apr 14 '13 at 18:25 You might want to check my post I made about bitcoin and fiat money: ummah.com/forum/showthread.php?376630-Bitcoin-Fiat-and-Islam user3273 Sep 27 '13 at 15:58 @sod6 interesting article ,can you post the summary relvant to this question as an answer Islam Sep 28 '13 at 8:36 have you all ever played Japanese smartphone games ? they integrate so much gambling in there but they are smart in covering it. their people all said it's not gambling. but you can see it has the gambling traits! and many players wasted many on their money just for the inexistent data! how crazy is this? I don't know much about bitcoins but I think bitcoin resemble that. kate Feb 23 '16 at 0:39 Continue reading >>
Islam And Bitcoin - Is Bitcoin Halal?
What is Bitcoin? Is Bitcoin halal? Is Bitcoin haram? Everything you'd like to know about Bitcoin in the world of Islam...and more! Welcome toIslam and Bitcoin. The website that intends to be the number one website for all information related to Bitcoin and other digital currencies as it relates to Islam inshallah (God willing). If you've made it to this website then you must have some questions such as, is Bitcoin halal? Is Bitcoin haram? Is Bitcoin mining halal? Is Bitcoin trading halal? Is investing in Bitcoin halal? Is cryptocurrency halal? Is Bitcoin legal in Saudi Arabia? Inshallah we will explore these issues and more as the goal ofIslamandBitcoinis to make the understanding of Bitcoin and cryptocurrency easy for its audience and to also serve as a hub for Muslims (scholars and everyday Muslims) who want to learn more about Bitcoin and the technology behind it even beyond the basics of halal and haram. So, if you would like to learn more then please do check out our blog where you will find articles and videos related to Bitcoin and definitely dont forget to check out the official Islam and BitcoinPodcast Series ; where we will, inshallah, deliver engaging dialogue with some prominent people involved with Bitcoin and other digital currencies as well as explore how this new technology could potentially benefit humanity and the world at large. I believe that Bitcoin, and cryptocurrency as whole, has the potential to be of wonderful benefit to humanity and the understanding of Bitcoin by the average non-technical person is of the utmost importance if humanity is to ever truly benefit from this technology. Whether Bitcoin is here to stay or fade away like a shooting star is truly only known by Allah, but as a Muslim, I am commanded and encouraged to do good deeds, an Continue reading >>
Ruling On Trading In Currencies - Islamqa.info
I would like to know about investment in curreny (FOREX Market). Like now a days, its very common that people invest in Euro to earn profits. One broker keeps on calling me to invest USD in Euro. Is trade in currency halal?. Dealing in currencies is permissible so long as the exchangetakes place in the same sitting as the contract is made. It is permissibleto sell euros for dollars so long as the exchange takes place in the samesitting as the contract is made. But when the deal is concerning the sametype of currency, such as selling one dollar for two dollars, that is notpermissible because it is a type of riba. In that case they should be ofequal amounts and the exchange must take place in the same sitting as thecontract if the exchange is concerning one type of currency. The evidencefor that is the report narrated by Ubaadah ibn al-Saamit (may Allaah bepleased with him) who said: The Messenger of Allaah (peace andblessings of Allaah be upon him) said: Gold for gold, silver for silver,wheat for wheat, barley for barley, dates for dates, salt for salt, like forlike, same for same, hand to hand. If the types are different then sellhowever you like, so long as it is hand to hand. Narrated by Muslim, 1587. It says in Majmoo Fataawa Ibn Baaz (19/171-174): Dealing in currency,buying and selling, is permissible, but that is subject to the conditionthat the exchange be hand-to-hand if the currencies are different. If aperson sells Libyan currency for American or Egyptian or whatever currencyhand to hand, there is nothing wrong with that, such as if he buys dollarsfor Libyan currency hand to hand, exchanging it in one sitting, or he buysEgyptian or English currency etc for the Libyan or whatever currency hand tohand, there is nothing wrong with that. But if there is a delay, t Continue reading >>