Is Litecoin Halal: Is LTC Coin Halal?

In this article we do a complete shariah screening of Ltecoin: LTC Coin to determine if it is a halal or haram cryptocurrency. The short answer is yes, Muslims may trade and invest in LTC crypto, but please read on to find out more.

From investing, trading to staking, we’ve got your halal crypto investments covered.

What is Litecoin?

Litecoin is an important spin-off of Bitcoin’s source code with four times faster block times and a fourfold larger supply. It has been considered a kind of silver to Bitcoin’s gold, testing new protocol changes before they are sent onto Bitcoin.

Litecoin shares many similarities with Bitcoin relating to block time, supply, hashing algorithm, and initial distribution. Litecoin wanted to make some modifications to Bitcoin while retaining the features that make this digital currency effective as a medium of exchange.

Litecoin utilizes 2.5-minute block times and an 84 million maximum supply. Charlie Lee’s original concept was to facilitate more transactions through faster block confirmation times and allow the currency’s supply to increase to prevent inflation.

Further details on Litecoin website

Who Invests In Litecoin?

Kenetic Capital

Parallax Digital

Litecoin Technology

Litecoin, the protocol, is a decentralized and up-to-date ledger of unspent transaction output (UTXO) transfers stored in a monolithic chain of 1MB data blocks. An interconnected network of mining and economic nodes maintains this blockchain by validating, propagating, and ensuring the inclusion of pending transactions (mempool) in new blocks.

A node belonging to the economic network is referred to as a full node. It is responsible for receiving and transmitting transactions from other network participants in the economic network, checking the validity of those transactions against consensus rules, and misdirecting them if deemed appropriate. Valid transactions are then sent to the economic network’s mempool. 

Legitimacy Screening of Litecoin

Litecoin was created by a former Google and Coinbase engineer Charlie Lee, in October 2011. It served as a silver to Bitcoin’s gold.

This gives us the confidence to confirm that LTC has an underlying fundamental value, that can be considered as “Mal” under Islamic rulings. Therefore, as a project it has legitimacy in terms of Shariah.

Is Litecoin project aligned with Islamic values?

Yes, Litecoin: LTC project does align with Islamic values as the project has a public roadmap, qualified team, and transparent management making it a compelling and well-accepted platform.. Nothing in the project is against Islamic ruling.

Financial Screening of Litecoin:

Financial screening ensures that the crypto asset meets the financial criteria for Shariah compliance, if it is an equity based token. Litecoin is not backed by any equity, so there is no financial screening required on this coin/ token. Here we would typically look at things like debt to income ratio to ensure borrowing is limited to a tolerable level.

LTC Token Screening for Shariah Compliance

Token Type: Native

Token Uses: Payments

LTC is commonly used as a native currency inside the Litecoin network. LTC can be used for peer-to-peer payments and value storage within the Litecoin network. With its faster block times, Litecoin aims to offer more committed plus immediate confirmations compared with Bitcoin. However, similar to Bitcoin, Litecoin plans to deepen scalability through the use of layer two solutions like lightnigh network.

Based on this Litecoin: LTC token is considered halal.

Is Staking LTC Coin Halal?       

Yes, staking Litecoin: LTC is Halal. The reward system relies on transactions that occur throughout the world by supplying the validator. The Proof of Work reward system doesnt have Riba, Gharar, or Maisir, Computing Power by specific hardware is an important factor in Proof of Work. The reward system is high-resourced, and it includes its own risks, but taking things into account this is permissable and in line with Islamic law. 

What Does The Muslim Crypto Community Think of LTC?           

Crypto Halal Office for Monitoring and Sharia auditing on cryptocurrency markets thinks Litecoin: LTC is a Halal digital asset based on its Shariah complaince screening.

Islamic Finance Guru believes Litecoin: LTC is a halal cryptocurrency based on its method of Shariah complaince screening.

Sharlife considers Litecoin: LTC as a halal cryptocurrency based on the five areas assessed for Shariah complaince screening. 

If you know of other academic or scholarly views on this, please add in comments and we will update accordingly. Alternatively, you may want to join our community of Muslims crypto investors and traders, to share, learn and profit from halal digital assets.          

Is Litecoin Halal: Is LTC Coin Halal?

Yes, Litecoin: LTC coin is Halal as it shares many similarities with Bitcoin, including block size, supply, hashing algorithm, and initial distribution etc. Litecoin was developed to make improvements on Bitcoin while also maintaining what works with this currency for settlement. Therefore, Muslims may trade, invest and stake Litecoing.

We hope you found this useful. Please view our Halal Crypto List to find suitable digital asset investments, without compromising your Islamic faith.