I was talking to one of my friends who told me that his cousin, who is a Muslim, bought some Bitcoins and his family, upon finding out, made him sell all his Bitcoins because according to some Islamic scholars they aren’t halal – halal. So, does that mean we are going to stand back while everyone else gets rich?
Are they going to… *cautiously looks around* say the F word for it?!
They couldn’t stop the Muslims and it was time when someone would have figured a loophole in this too. A local start-up company found last year worked their way around and came up with issuing gold-backed cryptocurrency. So, the investing could comply with their faith.
With the Middle East and the Gulf states not being part of this venture, it wouldn’t have been fruitful for the cryptocurrency either.
Word of Islamic law
Only around 20 to 30 percent of the banks in the Gulf and Southeast Asia follows the Islamic principles. Many Muslims tend to lean towards conventional banking as it offers higher returns and convenience.
Although, National Sharia law has not overtly passed a ruling on whether cryptocurrencies are permissible or not and although several global bodies recommend standards of Islamic finance, no one is able to impose them yet. Naturally, governments seem to be scared of its volatile nature but they are unwilling to not cash out their luck from this new technology.
Saudi Arabian and UAE central banks have warned their citizens – how nice to look out for them – but they haven’t outright banned it yet. After the ruling that was passed in 2014 in California, it changed the game for cryptocurrency in Islamic countries. It said that it deemed bitcoin as a legitimate medium of exchange. This resulted in South Africa ruling in favor of cryptocurrencies, arguing that they have become socially acceptable and commonly used.
However, it did face some backlash in other countries. Places like Turkey, India, Britain, and Egypt have labeled them impermissible.
OneGram is the start-up that was launched a year ago. The ideology behind this company is that its gold is the oldest and most stable asset around the world. It has been used a medium of trading for a really long time. So every OneGram is backed by one gram of physical gold, which makes it more stable floor price.
Not only this but it complies with the Shariah law. It is regulated keeping in mind the financial operations in the Islamic world. It is also a foundation of charity as it reaches out to those in need and helps them out.
PRAISE THY LORD!
For now, the matter of halal and haram, when it comes to cryptocurrency, is still up for debate. One thing’s for sure is that many Islamic scholars don’t have enough knowledge to fully understand the workings of this technology, so hasty fatwas by them can lead to it being banned. So we advise you to not go asking your local Imam about it!