Journal of Legal, Ethical and Regulatory Issues (Print ISSN: 1544-0036; Online ISSN: 1544-0044)


Virtual Currencies & Islamic Law: Origin, Features and Sharia Rulings

Author(s): Dr. Reema Misbah Al Qaruty

 This study focuses on analyzing an essential issue in the Islamic Sharia. It is the Virtual/ Crypto Currencies. First, it should be noted that this term is a new one, and therefore, we cannot find any reference to virtual currencies in the old writings of Muslim scholars. Furthermore, and according to the different views of economic systems, the function of currencies is still a contradictory issue. Indeed, most economists consider the traditional functions of money as being the real ones, and Muslim scholars approve this view assuring that money is a means of exchange as well as a measure of values. Accordingly, most central banks focus on these two functions for the purpose of achieving a level of stability among prices. Similarly, interpretations of Islamic Law assure that money shall be protected from any type of waste. On the contrary, there shall be constant efforts for exploiting and increasing money. Hence, money, and as stated above, is a measure of values and not a commodity to be traded or speculated through the internet without being supervised by central banks or other authorities, which regulate the work of financial institutions. This study is constituted of three main parts. While the first part focuses on the functions and features of money as viewed by Muslim jurists, the second part deals with the types, features and functions of virtual currencies, and how they are viewed by Muslim scholars. The third and last part attempts to show the legal implications of dealing with virtual/crypto currencies, and their impact on the countries’ economies.

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