A recent declaration by an Islamic scholar that Bitcoin is compliant with Sharia law could be the cause behind today’s $1000 price surge, opening the market to Muslim investors who were previously unsure if the cryptocurrency qualified as money under the Sharia law.
Bitcoin falls under certain definitions of money in Sharia law – anything that becomes widely accepted as currency by society or government mandate.
Mufti Muhammad Abu Bakar, a Sharia adviser and compliance officer at Blossom Finance in Jakarta, published a paper ruling that in certain cases, Bitcoin can indeed be Halal (permitted).
An excerpt read:
“In Germany, 'Oku 'iloa ia ko ha pa'anga fakalao mo fakafe'unga'i ko ia ko e ngaahi pa'anga faka-'Isilami 'i Siamane 'a e Bitcoin. 'I he ngaahi fonua hange ko he US, Bitcoin 'oku 'ikai fakalao 'a e tu'unga fakalao 'o e pa'anga ka ko e tali ki he totongi 'i he kehekehe 'a e kau fefakatau'aki koloa, pea ko ia 'oku ne fakafe'unga'i ko ha pa'anga faka-'Isilami angamaheni."
'Ikai ngata ai, 'Oku fenapasi 'a e tekinolosia Bitcoin mo e blockchain lelei mo e Sharia fakakaukau. Fractional talifaki fakapangike ai 'a e tokotaha 'oku 'a'ana 'a e pa'anga ko ia 'oku kau ki ai 'a e ola 'o ha “kinautolu 'o e noo” (efakalahi) 'Oku tapui. Koe'uhi he 'oku fakamo'oni'i ia 'e he blockchain 'a e tokotaha 'oku 'a'ana, it is actually more compliant with Sharia than banking, and this was all included in the paper published by Mufti Muhammad Abu Bakar.