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The concept of wealth (mal’) in Shariah and its relation to digital finance and cryptocurrencies

One of the concepts of Shariah is the direction of people to receive and accumulate righteous wealth. The sacred books especially emphasize the need to protect and use wealth in order to avoid waste or misuse. Muslim scholars describe wealth in Islam as something that has value and can be exchanged with others, while it has benefits permitted by Shariah.

“You who believe! Do not divide your property among yourselves unfairly, unless it is an exchange between you by mutual consent” (Quran, 04:29).


The term “mal'” in Shariah defines movable and immovable property, money, wealth. In the plural — amval. Initially, this term was used in relation to gold and silver, but then it began to be understood more widely. In Islamic law, small is material values that are acquired or accumulated to meet human needs. It is necessary that the mal’ has a material essence. Possession of any knowledge, health, fame, fame, etc. is not mal’. Another condition of Islamic law in relation to mal’ is the need for people to actually use material values. That is, things that are not suitable for use and spoiled food are not mal’. All material values are divided into those permitted by Sharia and those prohibited. Permitted for Muslims is small (mutakavvim) these are values accumulated through certain actions, labor costs that do not contradict the Divine Law. Forbidden mal’ (gayri mutavakkim) is material values accumulated by violating the provisions of Shariah. In this regard, the permitted small can be rented, sold, and the prohibited one cannot. In addition, there are movable (mankul) (which can be transported, transferred) and immovable (gayri mankul) small. An example of a mankula is money, and a gayri mankula is a house. Islamic law pays great attention to property issues and gives them the right to protect property from encroachments of other people.

The concept of wealth from the point of view of Shariah is considered in various discussions of Muslim scholars. Most of them describe wealth as something that has value and can be exchanged with others, while it has benefits permitted by Shariah and requires compensation if it is harmed by someone other than the owner.

Based on the above explanation, cryptocurrency (bitcoin) falls under the category of mutakawwim as long as it does not contradict the principles of Shariah al-mal. Bitcoin also falls under the category of mankul, not hacker, kiyami, not miles, istimmali, not istihlaki, nami and hash.

Since cryptocurrencies, NFT and digital financial assets, financial markets have received a new tool for obtaining wealth that Muslims can use. Regarding a new type of asset, Muslim scholars have two different definitions of wealth (al-mal’). The definition of al-mal’ given by the Hanafi school contains two important features:

1. The possibility of ownership and acquisition
If a thing is not in a state in which it cannot be possessed or achieved, it will not be considered al-mal’.

2. The possibility of using things
A thing that has no application will not be considered as al-mal’ in Shariah. Most scholars (Maliki, Shafidi and Ambali) have other signs that a thing can be considered as al-mal’. The value can be realized if the guarantee of its value is applied in case of breakage or damage of this thing. In addition, the Sharia must allow this thing to be used for its intended purpose (sanah) and by choice (ihtiyar), otherwise it will not be considered small. To be considered al-mal’, a cryptocurrency must meet all the criteria and features discussed above. The fact that the government or the central bank does not centralize the cryptocurrency does not mean that it cannot be used as money. Rather, it is a unique feature of the currency compared to traditional means of payment. Moreover, cryptocurrency meets many characteristics of money, such as durability, interchangeability, portability and recognizability. Consequently, trust and acceptance by users create the value of cryptocurrencies as they are willing to accept them as a payment method.

Users of cryptocurrencies can own them, buy and store them in their electronic wallet. Moreover, as long as cryptocurrency is available in financial markets, people can use it and benefit from it to meet their needs, such as buying a car, booking hotels and buying airline tickets, similar to credit cards, debit cards and cash. From the point of view of the possibility of storing and transmitting data, the cryptocurrency has a high ability to be stored in a blockchain system and transmitted through an electronic wallet from one user to another.

One of the important criteria for al-mal’ is that the thing/product must be allowed in accordance with the rules of Sharia. In this respect, cryptocurrency is similar to other currencies, where it is not derived from unacceptable elements and does not harm anyone. Like other currencies that can be spent for righteous purposes, cryptocurrency can also be spent for righteous purposes, such as paying zakat.

Therefore, the criteria or requirements established by classical and modern scientists for the compilation of al-mal’ should also be presented in cryptocurrency. Based on the above, we can assume that the cryptocurrency meets most of the criteria and other requirements that should be considered as al-mal’ from the point of view of Shariah. Therefore, cryptocurrency can act as al-mal’ and be the subject of transactions among Muslims.

Based on the above arguments, the permissibility of using cryptocurrency varies depending on whether it is regulated by the official financial authorities of the country and whether it is permissible from the point of view of Shariah and Islam.

The relation of Shariah to money and the centralization nature of national means of payment is not a fundamental or essential criterion. The dirham and the dinar were not controlled by either the Prophet (peace and blessings of Allah be upon him) or his caliphs. However, some scholars view centralization as a protection of wealth, since the government protects people’s wealth from financial failures. In this case, blockchain systems and cryptocurrencies are much more secure than fiat currencies. It is almost impossible to hack and steal cryptocurrency from the blockchain system, and the issue of digital coins is known to all their holders. In addition, tahamul (common use) and ishtilah (social consent) are two important characteristics that allow us to consider cryptocurrency as a currency and a means of wealth from the point of view of Sharia.

Based on the concept of al-mal’, there are several conditions that an object must have in order to be considered an object recognized by Shariah. The important conditions of al-mala from the point of view of Shariah are that the mal’ can belong to a person, it can be transferred, usable, valuable and suitable for storage. If all these conditions are met in digital assets, then they can be considered as an asset from the point of view of Shariah. Changing the ways of accumulating and preserving wealth (small) and using new means to obtain and acquire it, changes people’s attitude to digital finance and crypto currency, which are an excellent alternative to fiat currency.

The concept of wealth in Islam and cryptocurrencies

Islamic Coin is the first project to provide the community with powerful financial technology that allows for seamless transactions, support innovation and charity. The project is 100% compliant with Shariah law and benefits the community. Developers focus on sustainable development and use technology and innovation to ensure financial sustainability.

“At the heart of Islamic finance is the prohibition on charging interest. Islamic finance has always been focused on not shifting most of the risks to one side of the financial relationship. In Islamic finance, balance and transparency of transactions should be observed, which can negatively affect our society,” says Mohammed AlKaff AlHashmi, one of the founders of IslamicCoin.

IslamicCoin targets 1.1 billion Muslims using the Internet. The project creates convenient tools designed for users who have never been owners of cryptocurrencies. The mission of the project is to provide the international community of followers of Islam with a reliable and promising financial instrument that allows for independent financial interaction, support innovation and philanthropy.

Using the power of the Muslim community, Isalmic Coin can become one of the most important and valuable crypto assets. If 3-4% of the Muslim online community own an Islamic coin, it will become a bitcoin-scale crypto asset, bringing its holders a trillion dollars and $100 billion for the Evergreen DAO.

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