Shariah Assessment of Cryptocurrencies: Key Criteria

Analyzing cryptocurrency from a Sharia perspective requires careful consideration. Below are six key criteria to consider:Cryptocurrency Project:Understanding whether the underlying cryptocurrency project complies with Sharia principles is paramount. It is important to clarify the project's goals, its operating mechanism, and the services it provides. For example, partnering with a winery does not make the project haram, but if it profits from prohibited activities, this may call into question its use.Project Services:Sharia assessment is only critical if all services offered by the project are prohibited. If the project provides both permitted and prohibited services, the cryptocurrency can only be used for permitted activities. For example, using cryptocurrency for gambling is haram.Use of Currency:It is important to analyze how exactly cryptocurrency is used in the project. Even if the project is Sharia-compliant, certain uses may be haram, such as earning interest.Terms of Agreement:The terms of the agreement must not contain clauses that contradict Sharia. The presence of such clauses invalidates the entire agreement. For example, deflationary currencies, where a portion of the funds is burned to increase the value, may be contrary to Islamic principles.Project Credibility:Be sure to evaluate the credibility of the team and the project itself. Research the reputation of the developers, as well as their past successes and failures. Fraud and deception are strictly prohibited in Islam.Cybersecurity:The project must pay due attention to data security. Investing in projects with poor cybersecurity may be considered wasteful, which is also contrary to Shariah. Helpful Tip:When researching and investing in cryptocurrencies, always consult with qualified Islamic scholars to ensure your actions comply with Shariah principles. Remember that a conscious approach to investing will not only protect you from potential risks but also help keep your financial affairs within permissible limits.