The Arguments for Cryptocurrency Being Halal (Permissible)
Many scholars and Islamic finance experts who support the view that crypto can be halal base their arguments on the following points:
- Absence of Riba (Interest): The core technology of cryptocurrency, blockchain, is inherently decentralized and does not rely on interest-based lending to function. Since riba is a major prohibition in Islamic finance, the lack of an interest model in the crypto’s fundamental design is a strong argument for its permissibility.
- A Medium of Exchange: Some scholars argue that certain cryptocurrencies, like Bitcoin, function as a legitimate medium of exchange, a unit of account, and a store of value. They compare it to fiat currencies, which also have no intrinsic value but are accepted as money. As long as it is used for legal transactions and accepted by the parties involved, it can be considered a permissible form of “mal” (wealth).
- Technology is Neutral: A key argument is that blockchain technology itself is neutral. Its status (halal or haram) depends on how it is used. If a cryptocurrency is used for ethical purposes and is not involved in prohibited activities, then the crypto itself is permissible.
- Transparency: The transparency of a public blockchain, where all transactions are recorded, aligns with Islamic principles of accountability and honesty in financial dealings.