Egypt's Grand Mufti bans digital cryptocurrencies

Jan. 4, 2018 Share Source

On Monday, 1st January 2018, Egypt's Grand Mufti Shawqi Allam passed an official Fatwa (high-level Islamic ruling) forbidding the trade of decentralised digital cryptocurrencies, finding it unlawful in accordance with Islamic Sharia law. 

Because of the great risk/reward potential in using Bitcoin, the Islamic cleric argues that the use of Bitcoin comes with a "negative effect on its dealers' legal safety," and "undermines Egypt's ability to maintain and stabilise its own currency," Ahram Online reports.  

The response to digital cryptocurrencies from Allam resonates with the response by secular government bodies, notes an article from CoinDesk. Interestingly, there is a shared fear across most legal institutions, that the anonymity benefits of digital cryptocurrencies could 'undermine the legal system by enabling tax evasion, money laundering, fraudulent activities and terrorist financing'.

Just last month, a woman living in New York was indicted after laundering money through digital cryptocurrencies in order to send funding to so-called ISIS groups.

“As alleged, the defendant Zoobia Shahnaz engaged in a bank fraud scheme, purchased Bitcoin and other cryptocurrencies and laundered money overseas, intending to put thousands of dollars into the coffers of terrorists,”
" Bridget M. Rohde Acting United States Attorney US Attorney’s Office Eastern District of New York

According to the public report on The US Attorney's Office website, New Yorker Zoobia Shahnaz (27) was 'indicted for attempting to provide financial support to the ISIS terrorist group in a scheme that prosecutors say involved the purchase of cryptocurrencies using fraudulently obtained credit cards...'

Read Ahram article here

Read CoinDesk article here

Read Department of Justice report here

Sources

"Long Island Woman Indicted for Bank Fraud and Money Laundering to Support Terrorists." The United States Department of Justice. December 14, 2017. Accessed January 03, 2018. 

Staff writer. "Bitcoin trading is unlawful pursuant to Islamic Sharia, says Egypt's grand mufti." Ahram. Electronically published January 01, 2018. Accessed January 04, 2018.

Zhao, Wolfie. "Egypt's Religious Leader: Crypto Trading Forbidden Under Islamic Law." CoinDesk. January 02, 2018. Accessed January 03, 2018.

Which Muslim-majority country saw its Grand Mufti ban digital cryptocurrencies on January 1st, 2018?

Last Updated: April 4, 2018