A SHORT THREAD ON BITCOIN AND ISLAM.
Bitcoin and other cryptocurrencies are proposed as alternate currency models compared to the traditional currencies such as the Dollar, Riyal and euro,
Bitcoin and other cryptocurrencies are proposed as alternate currency models compared to the traditional currencies such as the Dollar, Riyal and euro,
albeit there are some fundamental differences between the two and the most important being that cryptocurrencies are a digital currency that exist only on the Internet without having a physical or tangible existence to it.
In addition to this there is no centralized organization that issues the currency and there is no real world asset that backs these currencies.The users of these currencies can purchase the currencies through Cryptocurrency exchange websites on the internet and.
Contrary to traditional currencies which are generally backed by assets such as gold or by other stronger currencies, cryptocurrencies are supported and generated by the users of the currency themselves.
Anyone interested in creating a cryptocurrency requires an Internet connection attached to a computer where he can install the currency ‘mining’ software and he can then use the mining software to generate the currency.
Cryptocurrencies can be used to trade on some ecommerce websites, in addition to this, they can be exchanged for physical currencies with people who are interested in purchasing them.
Today cryptocurrencies have become a speculative trade with people investing millions in them because of their continuously increasing price.
The currency which was accepted and implemented by the Prophet (saw) was the Gold and silver currency i.e. Dirhams and Dinars. This Islamic currency fulfilled three important conditions.
1. It was a basis to evaluate the goods & services, i.e it was a measure for prices and wages.
2. It was issued by a central authority which undertook the responsibility of issuing the dirhams and the dinars and it was not an unknown body.
2. It was issued by a central authority which undertook the responsibility of issuing the dirhams and the dinars and it was not an unknown body.
3. It was widespread and easily accessible among the people and it was not exclusive to a group of people only.
I evaluate it in light of the above three conditions that should be fulfilled by any currency and I find that cryptocurrencies do not fulfill the three above mentioned conditions.
1. Cryptocurrencies are not issued by any centralized institution or established organization rather they can be issued by anyone who has the relevant mining software and a computer with an internet connection.
2. Cryptocurrencies are a digital asset which have no tangible reality except the trust and confidence of some people in it. In addition to this, cryptocurrencies due to their nature of being tied to the internet is strictly limited to a small group of the population.
In short, cryptocurrencies fail on the condition that the currency should be easily accessible and widespread, rather it is limited to a small group of people who believe in its value i.e. it is not a currency for the society.
In addition to this, cryptocurrencies are a big domain for fraud, deception, speculation and cheating and therefore it is not allowed to trade in it i.e. it is not permitted to buy or sell them.
This is the reason why it is not allowed to purchase cryptocurrencies due to the shari’ evidences that prohibit the sale and purchase of any unknown ‘majhool’ asset
The Messenger of Allah (ﷺ) forbade selling what is in the wombs of cattle until they give birth, and selling what is in their udders unless it is measured out, and selling a slave who has fled,
and selling spoils of war until it has been distributed, and selling Sadaqah until it has been received, and what a diver is going to bring up.”
The prophet (PBUH) prohibited the ‘hasah’ Transactions. The Hasah sale is when the seller says to the buyer: ‘When I toss the pebble at you, then the sale between you and I is final.’
“The Gharar sale is the sale of ambiguous and unknown (majhool, ghayr maloom)) which includes selling fish that are in the water, selling a slave that has escaped, selling birds that are in the sky and similar type of sales all of which are prohibited.
Allah knows best.
May Almighty Allah forgives our shortcomings and grant us the ability to have halal earnings/incomes.
Assalamu alaykum wa rahmatullahi wa barakat.
@BITO_WALE @_alade_ @LaptopMechanic @ibras007 @_Watchmann @Bruchagher @7signxx @DesertQueenB @zee_zeey
May Almighty Allah forgives our shortcomings and grant us the ability to have halal earnings/incomes.
Assalamu alaykum wa rahmatullahi wa barakat.
@BITO_WALE @_alade_ @LaptopMechanic @ibras007 @_Watchmann @Bruchagher @7signxx @DesertQueenB @zee_zeey
