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Bitcoin Surges; Research Paper Says Cryptos Compliant with Sharia Law

Cryptocurrency NewsApr 12, 2018 09:25AM ET
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Bitcoin was higher on Thursday.

Investing.com - Bitcoin and other virtual coins rose on Thursday, after a research paper claimed that the virtual currencies were compliant with Islamic religious law, or Sharia law.

Bitcoin was trading at $7,685.60, gaining 10.62% as of 9:22 AM ET (13:22 GMT) on the Bitfinex exchange. Despite the surge, the virtual currency is far from its peak of $20,000 in December 2017 and has struggled to recover since falling below $6,000 in February.

The total market cap of cryptocurrencies rose to about $297 billion, at the time of writing, from about $269 billion on Thursday.

Mufti Muhammad Abu Bakar, Sharia advisor and compliance officer at Blossom Finance, published a study Thursday that argues bitcoin does qualify as Islamic money, unless forbidden by a local government. The paper argues that cryptocurrencies are compatible with the Sharia prohibition against fractional reserve banking. However, the study said that initial coin offerings or ICOs, are not recommended, as they are highly uncertain.

Islamic academics have been struggling to determine if owning and profiting from digital currencies is compliant with religious law. In December a Muslim cleric declared that owning bitcoin was compatible with Islamic finance but Egypt’s top Islamic cleric has ruled against owning bitcoin.

On the regulation front, the Philippines financial regulator has issued a warning to cloud mining operations that are not registered with the country’s Securities and Exchange commission. Meanwhile, a bitcoin exchange in Pakistan closed after the central bank announced a ban on dealings with cryptocurrencies. Urdubit has told customers to withdraw their funds “as fast as possible.”

Other virtual currencies were up, with rival Ethereum, the world’s second largest cryptocurrency by market cap, up 9.98% to $462.04 on the Bitfinex exchange. Ripple, the third largest virtual currency, increased 12.34% to $0.56111 while EOS was at $9.0653 a rise of 26.36%.

Bitcoin Surges; Research Paper Says Cryptos Compliant with Sharia Law
 

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