Recently, a working paper on whether Bitcoin is Halal or Haram, commissioned by Blossom Finance said that Bitcoin fully meets the definition of Islamic money under certain conditions and is generally permissible under Shariah.
The research and the development of the working paper was headed by Mufti Muhammad Abu Bakar – Blossom’s internal Shariah advisor and Shariah compliance officer.
According to Bakar, “Some scholars are of the view that bitcoin is permissible in principal. This view can be analysed in light of our previous discussion with regard to both the criteria and definition of property (mal) and money.”
The document added, “According to this principle, cryptocurrency is permissible principally. Likewise, anything can be considered as money if it has these attributes:
1. treated as valuable thing among the people,
2. accepted as medium of exchange by all or substantial group of people,
3. it is a measure of value,
4. and it serves as unit of accounts
Therefore, any cryptocurrency which fulfills these conditions (such as Bitcoin) is
acceptable as money”
It further said that as far as the current Shariah status of bitcoin is concerned, the author agrees with the second view that bitcoin is permissible in principal as Bitcoin is treated as valuable as reflected by market price on global exchanges and it is accepted for payment at a wide variety of merchants, including bakeries, restaurants, among others.
For Indian Muslims, this means a certain relief. Dr. Tausif Malik, founder of All India Muslim Business Startup Network and Mahabfic (a company that has started numerous blockchain-enabled initiatives in Maharashtra) told Crypto-News India, “I am not a speculator and I do not invest in crypto. However, around 15% of Indian Muslims, from the total population do invest in cryptocurrencies. Everyday I get around 5-10 calls from potential investors asking me where they should invest. Looking at the interest level, I’d say around 25% of Indian Muslims will invest in cryptocurrencies, by the end of this year. ”
Dr Malik attributed the popularity of cryptocurrencies to a few factors: 1) Other assets such as real estate, stock market have gotten too expensive for the common man, 2) Cost of a cryptocurrency transaction is comparatively negligible which makes it a crowd favourite.
A trader who wished to be anonymous said, “Crypto market in India cant move global markets as the trade volume is too low. If some prominent religious figure backed the research the global markets might see some surge like we did last week. 2. Indian muslims are already in, but we cant speak for all of them.”
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