HALAL Screening Cryptocurrency
Is Bitcoin Halal?
Complete Shariah Compliance Screening of Bitcoin to determine if it is a Halal or Haram cryptocurrency
Legitimacy Screening
What is Bitcoin
Bitcoin, often called BTC, is a type of digital money that allows people to send and receive payments over the internet without needing a bank or middleman. It works on a technology called blockchain, which is like a public ledger that records all transactions securely and transparently. This means that everyone can see the transactions, but personal information remains private. Bitcoin is designed to be decentralized, meaning no single entity controls it, which gives users more freedom and control over their money.
What makes Bitcoin unique is its limited supply—there will only ever be 21 million bitcoins created. This scarcity, combined with its growing acceptance as a form of payment, has made it popular among investors and everyday users alike. Plus, Bitcoin is often seen as a "digital gold" because people use it as a store of value, especially during times of economic uncertainty. So, whether you're looking to buy something online or invest for the future, Bitcoin offers a new and exciting way to think about money!
Transparent and Credible Team
While the founder, Satoshi Nakamoto, is pseudonymous, the Bitcoin network's operations are transparent through the blockchain and the open-source nature of the software. The code is available for review by anyone and there is a large community of developers maintaining it. The long-standing domain registration of bitcoin.org since 2008 also adds to its credibility. This suggests a high degree of transparency despite the lack of a known team. Score: 85
Clear Use Case or Purpose
The whitepaper clearly articulates Bitcoin’s purpose as a peer-to-peer electronic cash system. The goal is to facilitate transactions without intermediaries. This is a clear and legitimate use case that aligns with a basic function of money. Score: 95
Absence of Fraudulent Behavior
There's no central entity to perpetrate fraud. The proof-of-work mechanism and the decentralised nature of the network make it very difficult to manipulate. The blockchain explorers provide transparency in transactions. However, there have been instances of misleading claims made by companies associated with Bitcoin. Score: 85
Ethical Practices
Bitcoin is built on open-source principles, and operates transparently, but is pseudonymous. The community-driven nature and lack of central control support ethical practices. However, the lack of direct customer service could be viewed as a minor drawback. Score: 85
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Bitcoin Halal Project Screening
- Are the project’s purpose and operation Shariah Compliant.
- Does the project operate ethically and transparently, without harm to society.
- Does the project promote positive societal or environmental outcomes.
Bitcoin Financial Screening
- Does the revenue involve Riba (interest), Gharar (excessive uncertainty), or Haram activities.
- What red flags are hidden within the projects finances and are within permissible limits.
- Types of revenue generation activities and the percentage that may be Riba or interest based.
- Audits from reliable sources
Bitcoin Token Screening
- Is the Token governance fair and ethical?
- Are profit-sharing mechanisms (e.g., staking rewards, dividends) compliant with Islamic Finance?
- Does the token’s design, or unlock schedule raise unethical concerns?
- Halal underlying asset, and free from impermissible elements
Is Staking Bitcoin Halal?
- Are the staking operation aligned with Shariah-compliant structures.
- Does the staking avoid Gharar (excessive uncertainty) and Maysir (gambling)?
Bitcoin Shariah Compliance Score
- Total Shariah Compliance Score out of 100
- 27 different components researched
- More comprehensive than any other platform