Is Crypto Halal or Haram? What Different Scholars Say

Cryptocurrency is a new type of investment class and scholars are still grappling with the topic. There is a sharp divide in terms of views on the subject right now.

We have created a detailed Cryptocurrency Guide for a Muslim investor here, but in this article we wanted to share a list of some senior scholars who are against cryptocurrency as well as some who are for it.

Please note that a lot of the fatawa relate to bitcoin – not necessarily all cryptocurrencies – however the analysis will be similar for many cryptocurrencies.

Also, some fatawa are from 2-3 years ago, during which time things have developed enormously in the crypto industry, and as such the scholars may have a different view reassessing today.

Scholars who say crypto is haram

1. The Grand Mufti of Egypt – Shaykh Shawki Allam – this is the BBC article announcing the news that the Shaykh views bitcoin as haram and this is the original Arabic source. The Mufti argues that there is a high degree of uncertainty, risk, fraudulence, He also noted that there is no deep or systemic control or rule mechanism around the issuance of these coins and that this currency is not linked to any established marketplace or economy.The Shaykh also noted the instability and price fluctuations that bitcoin is prone to and the risks that brings to market participants.He also noted that in order to effectively store bitcoin you need to keep the unique private key for your bitcoins safe through heavy encryption in order to ward of theft, virus attacks and loss. This high level of sophistication needed means that bitcoin is a far remove from normal currencies and the stability and relative ease of storage for them.If there has been a loss or a theft there is almost nothing that can be done to recover the amount – which is very different to if your normal currency was misplaced by a bank for example.

   The mufti also noted that bitcoin is often used by criminal and nefarious elements to fund their work too due to the untraceable nature of the cryptocurrency.

   [1] https://islamicbankers.files.wordpress.com/2019/02/2017-shariah-analysis-of-bitcoin-cryptocurrency-blockchain.pdf