Usually, warnings about the volatility of cryptocurrencies or announcements about limitations on their use in stock exchanges or formal exchange houses, come from the financial authorities of countries. Therefore, the ban on operating bitcoin in Egypt by Egypt's highest religious authority marks a landmark in the history of this emblematic cryptocurrency.

The Grand Mufti Shawqui Allam, the highest Islamic religious authority in Egypt, issued an official edict or fatwa on Monday stating that trading with bitcoin is not permissible under sharia or Islamic law, since this currency is not accepted by the competent authorities as an "acceptable interface of exchange".

Cryptocurrencies, decentralized digital assets, increased its market value by 3,200% in 2017, in part because it received formal recognition from traditional financial entities, including those that manage forward contracts and which in December included bitcoin in their futures contract offering. Bitcoin oscillates this Tuesday around $14,800 dollars, approximately 260,000 Egyptian pounds.

Stressing that bitcoin is not subject to state oversight or financial authorities, Allam said its fatwa was published after extensive consultations with several expert economists. He stressed that "both the inherent risk of the currency and its potential for large profits weakens Egypt's ability to maintain and stabilize its own currency.

Allam added that bitcoin "can have a negative effect on the legal situation of those who trade in that currency because they do not account for their operations, which can facilitate smuggling and money laundering," he said.

The religious leader further stated that the use of cryptocurrencies is similar to gambling, which is forbidden by Islam because of "its direct responsibility in the financial ruin of individuals.

Egypt has not followed in the footsteps of countries such as Sweden and Japan, which, despite the lack of regulations, are considered to be in favour of cryptocurrencies, leaning more towards the position of countries such as Bolivia and Bangladesh that have banned them.

Last month the Egyptian Finance Regulatory Authority (FRA) declared that bringing investors into cryptocurrencies is considered "a form of deception that falls into illegality," in line with the imam's new claims.