The Egyptian Grand Mufti has issued an official fatwa, banning bitcoin which soared in value over the $20,000 mark in December.
Trade in cryptocurrency is similar to gambling, which is forbidden in Islam, he said.
The fatwa was issued after consultations with several economic experts, Egypt’s Grand Mufti Shawki Allam said on Monday, as cited by Ahram newspaper.
Egypt’s legitimate bodies do not consider trading a virtual currency like bitcoin to be acceptable, he said, and the use of cryptocurrencies “impinges on the state’s authority in preserving currency exchange.”
The mufti compared cryptocurrency’s trade exchange to gambling, which is banned in Islam “due to its direct responsibility in financial ruin for individuals.” The cleric said that bitcoin could negatively affect the legal safety of those who trade it, and lead to an “ease in money laundering and contrabands trade.”
Allam’s statement came as the value of bitcoin continues to fluctuate unpredictably. As of January 3, its price stands at $15,000.
Egypt’s Grand Mufti is not the first Muslim cleric to criticize the now-famous cryptocurrency, which has skyrocketed in value over recent months. In December, popular Saudi cleric Assim Al-Hakeem ruled that digital currencies are banned under Islamic law because they are “ambiguous.”
“We know that bitcoin remains anonymous when you deal with it… which means that it’s an open gate for money laundering, drug money and haram [forbidden] money,” Hakeem said at that time.
In November, Turkey’s highest religious authority – the Directorate of Religious Affairs, also known as the Diyanet – declared that buying and selling of digital currencies is at odds with its religion due to its lack of regulation and close connection to criminal activities.
Last year saw cryptocurrencies steal the headlines and take retail investors on a rollercoaster ride. Despite declines in December, bitcoin has seen a remarkable rise over the course of 2017, during which its price increased by over 1,300 percent.