The legality of cryptocurrency from an Islamic perspective: a research note

Saleh Nawaz Khan

Journal of Islamic Accounting and Business Research, 2022, vol. 14, issue 2, 289-294

Abstract: Purpose - Islamic scholars are not unanimous on the legality of cryptocurrency. Muslims are confused about the permissibility of cryptocurrency. Thus, this study aims to evaluate the cryptocurrency from Shariah’s perspective. Design/methodology/approach - This study is qualitative and uses a deductive research approach. It drives conceptual and logical deduction fromQur'anand Hadith. Findings - The cryptocurrency is an intangible currency without any precious metal or commodity backing. It does not possess any intrinsic value, and also its prices are highly volatile. On these grounds, cryptocurrency does not qualify as money in Islam. Social implications - Cryptocurrency is not compatible with Islamic principles. It is not legal tender and is not backed by any government. Its prices are highly volatile, which opens the door for speculation. Muslims should avoid investing in it. Originality/value - This study fulfills an identified need to evaluate cryptocurrency as money from Shariah’s perspective.

Keywords: Decentralization; Quran; Speculation; Sunnah; Cryptocurrency; Intrinsic value; Gold or silver; E40; Z12 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eme:jiabrp:jiabr-02-2022-0041

DOI: 10.1108/JIABR-02-2022-0041

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