Cryptocurrencies can be considered sitting in a grey area today. In fact, even the US Securities and Exchange Commission are still debating whether or not to include Bitcoin and other altcoins as securities. In fact, it isn’t surprising considering that it is new technology to all of us.
There are a lot of things that affected Bitcoin price over the last months. In fact, from excitement and investors’ fear of missing out on regulatory changes, Bitcoin’s almost $20,000 value has shrunk to less than half even struggling to maintain $8,000 in recent months.
However, it seems that Bitcoin has found itself an unexplored market. An Islamic scholar has been able to declare Bitcoin permissible under Sharia Law. This could mean that Bitcoin has potentially opened up to 1.6 billion Muslims worldwide.
There was a study that was published whether or not Bitcoin is considered halal or haram. In just less than an hour after the publication of the study, its value surged by $1,000 in just less than an hour.
Halal or Haram?
The study was conducted by Muhammad Abu-Bakar of Blossom Finance in Indonesia. He was able to explore the functionalities of the cryptocurrency. And also, he was able to determine whether or not Bitcoin is applicable to the strict rules of Islam’s definition of what money is.
According to Matthew Martin, the CEO of Blossom Finance, he said that “several recent fatwah issued by prominent Muslim scholars offered incomplete or contradictory opinions on the topic”. He also added that “with all the confusion out there, we wanted to offer clear guidance supported by solid research that benefits both laypeople and practitioners of Islamic finance”.
Legal Currency in Germany
According to the author, Germany considered Bitcoin as a legal currency and therefore it also qualifies as an Islamic money in the country. According to the study, “Bitcoin is permissible in principal as bitcoin is treated as valuable by market price on global exchanges and it is accepted for payment at a wide variety of merchants”,
In addition to this, the study also mentioned that “Moreover, many private individuals accept bitcoin as a medium of exchange in their private transactions”.
A Lucrative Market
In just an hour, there was an influx of more than a billion dollars’ worth of Bitcoin transactions that were recorded on different exchanges. There are experts who believe that the study has something to do with the fluctuation in the number of trades.
The thing with cryptocurrencies is that it can be swayed easily either by good or bad news. Luckily, for this one, it may have helped boost the price of cryptos. According to Olga Feldmeier, the CEO of fintech startup Smart Valor, “many speculated that the sentiment around bitcoin was getting more positive, and that it may have been related to Sharia compliance”.
Now that Bitcoin is said to be accepted in the Muslim community, will this mean that there is also a new market for other cryptocurrencies? Will Bitcoin be able to have a bullish run in the coming months considering the rough months that it had?