Bitcoin declared illegal in Egypt as top imam likens cryptocurrency to gambling

  • Imam calls for ban on digital cryptocurrency
  • Regulators denounce Bitcoin trading as ‘unlawful’

Egypt’s top religious leader has called for bitcoin to be banned as it contravenes Islamic law, with the chief imam comparing the cryptocurrency to gambling.

Bitcoin's value spike could see a windfall for players with money sitting in accounts
Bitcoin doesn’t appear to sit well with Egypt’s top imam.

“Bitcoin is forbidden in Sharia as it causes harm to individuals, groups and institutions,” reads a fatwa issued by Grand Mufti Shawki Allam.

Egyptian officials have spoken out against the growing digital currency, arguing that it contravenes religious laws and that it has links to organized crime, terrorism and other harmful agencies.

Saudi Arabia and other Middle Eastern nations are also looking to block bitcoin trade on the grounds of it breaching religious laws.

Regulators tackle legality of new digital currencies

Egypt’s first Bitcoin exchange opened in August 2017. At the time of launching, no regulation or restriction existed to control Bitcoin trading. “We’re still waiting on the Egyptian government to set some kind of regulations,” said Bitcoin Egypt founder Rami Khalil back in August.

“Without any laws, bitcoin is not legal money in Egypt.”

The Egyptian Financial Supervisory Authority agrees. Agency head Mohamed Omran declared last month that Bitcoin trading is illegal under Egyptian law. Lawmakers and religious leaders say the cryptocurrency has no set contract rules, making it illegal under Islamic law. There are also fears that profits from Bitcoin trading could be used to fund criminal activities, including terrorism.

Bitcoin Egypt remains undeterred. “Cryptoassets are happening whether (the Egyptian government) joins in or not,” Khalil stated.

“By not joining they’re missing out on a very big market.”

Is Bitcoin like gambling?

There are aspects of Bitcoin trading that do resemble gambling – but then, all forms of trading carry some element of risk.

Because bitcoin is such a new currency, it is relatively unstable and the value of coins as assets can change dramatically over a short period of time. The value of a single Bitcoin was just 0.003 cents in 2010, while in 2017 the currency hit a record high of more $18,000 per coin.

Investors can achieve immense payouts for relatively small investments, but there is the potential for huge losses too.

Despite resistance, bitcoin continues to thrive all over the world – including in Egypt.

“We’re trying to get people used to the idea of Bitcoin, to ready the market so that in a couple of years we will reach a greater number of users,” said Bitcoin Egypt co-founder Omar Abdelrasoul.

“But for now we are trying to let people know what cryptocurrency is.”

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