Any speculative investment, which contains uncertainties, is forbidden in Islam. Muslims are also urged to respect their spending so as not to succumb to debt or go on a spending spree, which is also one of the reasons whytrading is Haram. What about crypto-currency? Here are the details.
Are crypto-currencies banned?
Islamic finance specialists declare crypto to be a speculative investment. It is thus prohibited because it contains "gharar or a uncertainty, of danger or the riskin other words, the sale of what doesn't exist.
In fact, Alkaff AlHashmi, the co-founder of Islamic Coin, stated that :
"Sharia is forbidden and considers transactions based on chance are null and void or speculation rather than an effort to produce a return."
However, he insists that the principle does not prohibit commercial speculation in business transactions. In fact, Sharia law is sufficiently intelligent and flexible to allow for embrace technological change in every era.
And Bitcoin: Is it Haram?
The interest on monetary debt commonly known as "Riba" is Haram for ethical reasons. However, the Bitcoin is halal. Indeed, debt is unlikely to appear to any great extent in a bitcoinized world. This is for economic reasons. The risks are correctly assessedThis means they can be shared legitimately, rather than transferred dishonestly.
Moreover, the bitcoin ethic is based on the principle of a weak preference for the present. It thus presents a clear resemblance to cultural norms of Islamic economics. According to Abul Ala Mawdudu:
"It is incumbent on every member of the Muslim community to live within his means. He is forbidden to let his expenses exceed his income, which would force him to ask others for help to finance his spending follies, to use immoral means to seize other people's wealth or to get into debt with others to help finance his incessant needs and, by consuming his resources to repay his debt, ultimately join destitute ranks."
