Bitcoin Could Penetrate a Massive New Market 📈

Adoption is a driving force in charting the value of any digital currency, including bitcoin. Put simply, increased adoption not only legitimizes digital currencies as an asset, but has the potential to lead to higher prices.Bitcoin, the largest cryptocurrency by market capitalization, could gain access to a substantial new market after an Islamic scholar said the digital currency is usable under Sharia law. Previously, authorities and scholars in Muslim countries, such as Egypt and Turkey, said bitcoin was not permissible under Sharia law.The new study, conducted by Muhammad Abu-Bakar of Blossom Finance in Indonesia, examined bitcoin and other cryptos to see if the asset class could meet Sharia’s definition of money.“The study’s author points to the fact that bitcoin is recognised as a legal currency in Germany and therefore qualifies as Islamic money in that country,” reports The Independent.In the study, Abu-Bakar that an essential point in determining bitcoin’s eligibility under Sharia law is the examination of Sharia’s definition of “mal,” or property. The study notes some Islamic scholars have applied different definitions to mal, but that the “fundamental requirement for a counter of value or consideration is that it has status, or mal, meaning property.”

Massive Potential

Bitocin rallied Thursday, due in part to online chatter about Abu-Bakar’s paper. That rally continued Friday with nearly all the major cryptos trading higher and bitcoin seen, at this writing, flirting with $8,100. That indicates market participants like the idea of bitcoin potentially being made accessible for use by the world’s 1.6 billion Muslims.There are reasons why bitcoin should be Sharia compliant. Previously, Islamic scholars have argued the digital currency is not permissible under Sharia law because it is speculative and can be used for illicit purposes. However, as Abu-Bakar points out, fiat currencies and gold, can be speculative and volatile, and traditional currencies, like the dollar and euro, can be used for nefarious purposes.Abu-Bakar does note that cryptos would not be permissible under Sharia law if particular areas and jurisdictions outright banned the asset class.