Bitcoin launched in 2009 as a digital currency that does not depend on any bank or government. Its supply is capped at 21 million coins, and every transaction is recorded on a public ledger, the blockchain. It is also volatile, and for Muslims it raises a real question: can it be held or traded within the Shariah?
There is no single answer that all scholars agree on. What follows is the set of questions they weigh, so you can understand the positions and ask the right questions yourself.
Question 1: Is it a lawful form of wealth (mal)?
Some scholars argue that Bitcoin has value because people accept it and it can be exchanged, which is how many forms of wealth work, including modern paper money. On that view it can be owned and traded like other assets. Others argue it has no intrinsic value and no issuer standing behind it, so it cannot count as wealth at all.
Question 2: Is there excessive uncertainty (gharar) or gambling (maysir)?
Bitcoin's price can move sharply in a single day. Some scholars see its trading as too close to speculation and gambling. Others answer that volatility alone does not make an asset prohibited, since many permissible assets rise and fall, and that the question is how a person uses it.
Question 3: What is it used for, and is it legal where you are?
Scholars give weight to whether an asset is widely used for unlawful purposes, and to whether it is permitted by the law of the land. Official religious bodies have reached different conclusions. For example, Egypt's Dar al-Ifta declared trading in Bitcoin impermissible in 2018, and Turkey's Directorate of Religious Affairs said in 2017 that buying and selling cryptocurrencies was not compatible with religion at that time. Some other scholars and Shariah advisers have concluded that holding it as a digital asset can be permissible.
Where most scholars agree: how you hold it matters
Whatever their view of Bitcoin itself, scholars broadly agree that some ways of dealing in it are not permissible:
- Borrowing on interest to buy it, including interest-bearing margin.
- Leveraged and derivative products such as futures and perpetual contracts.
- Interest-style lending and yield products, where you lend your coins for a guaranteed return.
Buying outright, with your own money, holding it yourself, and avoiding these products is the approach those who permit it generally describe.
How Hudood thinks about crypto
The crypto screening we are preparing looks at a coin across six dimensions: its consensus mechanism, the project's real use, the token's financial mechanics, any staking or reward model, the transparency of its documentation, and the credibility of its team. Until that screening is complete and reviewed, Hudood shows crypto prices and charts only, with no verdicts.