July 21, 2024
Is Bitcoin Halal or Haram? Oman's Crypto Controversy
Bitcoin News

Is Bitcoin Halal or Haram? Oman’s Crypto Controversy

Following a recent round of multi-million dollar investments this month, the Sultanate of Oman, which is situated on the southern coast of the Arabian Peninsula, is strengthening its embrace of bitcoin. The West Asian country is working to establish itself as a digital hub in a competitive region.

The Omani government revealed about $800 million in new investments in cryptocurrency mining businesses in August. The first licensed crypto-mining organization in Oman, Green Data City, and the Abu Dhabi-based Phoenix Group signed a $300 million agreement on August 23 to build a 150-megawatt crypto-mining farm that would start operating in 2019. According to a local news report, a $370 million farm run by Exahertz International with plans to introduce 15,000 additional units by October was allowed by Muscat a few weeks earlier.

Said Hamoud al-Maawali, Oman’s Minister of Transport, Communications, and Information Technology, described the investments as a “major milestone” in the country’s efforts to “help accelerate the growth” of its digital economy.

Oman’s latest ventures into bitcoin mining come as the larger region is beginning to embrace cryptocurrency. It also follows an extensive discussion about a crucial issue facing the Islamic world: Is cryptocurrency permissible or prohibited?

Financial rules outlined in Islamic law, or sharia, decide whether an action is ethically acceptable (halal) or not (haram). According to some Islamic experts, bitcoin is forbidden since it is frequently speculative. This belief led to the issuance of fatwas (Islamic legal decrees) by important Islamic organizations in Turkey, Egypt, and Indonesia, the largest Muslim nation in the world.

Others, on the other hand, contend that digital currencies can be considered halal under Islamic law since they lack the interest (riba) that would be associated with holding tokens like Bitcoin, which is prohibited by sharia. It is also asserted that the fact that cryptocurrencies are widely used as a form of payment may help to prove that they are halal.

Muslim nations have been among the biggest users of Bitcoin in recent years, despite the ongoing dispute among Islamic academics.

The Middle East and North Africa, which include a majority of Muslims, were the fastest growing cryptocurrency markets in 2022, according to a Chainalysis analysis from October of that year. Four of the top twenty adopters on Chainalysis’s Crypto Adoption Index were Muslim-majority nations, and they were joined by states with sizable Muslim populations, including India and Nigeria.

But the legal framework continues to be a patchwork of various laws throughout the Muslim world. On the one hand, nations like the United Arab Emirates have taken the lead in positioning themselves as desirable global hubs for cryptocurrency entrepreneurs. On the other side, some nations, like Turkey, have laws that permit cryptocurrency trading but forbid its use for payments and by monetary intermediaries.

Image: Freepik

Disclosure Statement: Miami Crypto does not take any external funding, or support to bring crypto news to the readers. We do not have any conflicts of interest while writing news stories on Miami Crypto.

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