Find out the Islamic point of view on bitcoin, whether it’s haram or halal. And how this debate sparked controversy among scholars on investing in Bitcoin.
Introduction:
Bitcoin created in 2009, is a digital currency that is used for secure online financial transactions. Bitcoin has created massive hype and excitement among investors. Its value has risen from a few dollars to thousands of dollars.
However, the rise of Bitcoin has ignited strong debate among Islamic scholars about whether investing in Bitcoin is haram or halal. Some argue that Bitcoin is ḥarām (forbidden) due to its abstract nature and possibility for fraud and manipulation. Others claim that it is ḥalāl (permissible) due to its crystal clear transactions.
In this article, we will explore the Islamic perspective on Bitcoin by discussing the arguments: is it halal or haram to invest in Bitcoin?
Is Bitcoin haram?
1-Abstract nature of Bitcoin:
Some Islamic scholars argue that Bitcoin is ḥarām due to its abstract and unknown nature, you are unaware whether you will profit or lose. All is about taking risks in investments that resemble gambling. The Quran prohibits gambling and assumption. That’s why some scholars argue that Bitcoin’s value is based on speculation rather than any basic and exact value so it is not permissible in Islam.
. “The Prophet (peace be upon him) said: ‘There are three types of people with whom Allah will not speak on the Day of Resurrection, nor will He look at them, nor will He purify them, and they will have a painful punishment. They are: …the one who consumes Riba (usury), the one who consumes intoxicants, and the one who plays games of chance (gambling).'” (Narrated by Abu Hurairah, Sahih Muslim)
2-Chance of manipulation:
Additionally, there is a lack of any rules and regulations in the cryptocurrency market which raises the chance of fraud and manipulation. The Quran strictly prohibits deceit and fraud.
The Prophet (peace be upon him) said: ‘Whoever deceives us is not one of us.'” (Narrated by Abu Hurairah, Sahih Muslim)
So some scholars argue that investing in Bitcoin is haram due to the ambiguity and decentralized nature of Bitcoin.
Is Bitcoin halal?
Decentralized nature of bitcoin:
Some Islamic scholars argue that Bitcoin is ḥalāl due to its decentralized and transparent nature. The Quran highlights the importance of fairness in investments. some scholars argue that Bit coin’s decentralized nature promotes fairness and transparency. So it is permissible in Islam.
“And do not consume one another’s wealth unjustly, nor offer it to judges so that you may consume a portion of people’s wealth unjustly, while you know.” (Quran 2:188)
Profit and loss according to Islamic principles:
Additionally, Bit coin’s supply is limited which supports Islamic principles of avoiding excessive inflation and maintaining the value of money. The Quran prohibits usury and interest. Some scholars argue that Bitcoin transactions simply involve profit and loss. And according to Islamic principles of trade and do not involve these prohibited activities of profit and usury.
The Shariah Advisory Council’s Ruling
In 2018, the Shariah Advisory Council of the Malaysian Islamic Financial Centre declared that Bitcoin is ḥalāl. The council quoted that Bit coin’s investments are likely to encourage financial transactions and reduce poverty. The council claims that its decentralized and transparent nature aligns with Islamic principles.
“The SAC has resolved that the usage of Bitcoin is permissible (harus) under Sharia law, as long as it is used within the boundaries of Shariah principles.”
However, other scholars and organizations have disagreed with this ruling.
Conclusion
The question of whether Bitcoin is ḥalāl or ḥarām remains an unsolved debate among Islamic scholars. Some favor Bit coin’s investments due to its transparency. While others oppose it due to the risk of fraud and manipulation. Ultimately, the decision to invest in or use Bitcoin should be made carefully. consider all the potential risks and benefits. Bitcoin investment should be based on the principles of Shariah that highlight justice, fairness, and transparency in all financial transactions and with consultation with Islamic scholars and experts.
Faqs:
1: Is Bitcoin Ḥarām or Ḥalāl?
A: It is a disputed debate among Muslim scholars whether Bitcoin is halal or haram. Some consider it Ḥarām due to its speculative nature, while others consider it Ḥalāl due to its transparency.
2-Can Muslims invest in Bitcoin?
A: Yes Muslims can invest in Bitcoin by completely understanding Islamic law. Consult Muslim scholars to determine the permissibility of investing.
3: Are there any digital currencies other than Bitcoin that are considered Ḥalāl?
A: Yes, some Islamic scholars recommend that investing in Shariah-compliant cryptocurrencies is allowed. they adhere to Islamic principles and values.
