Haqq or Māl? The Real Status of Cryptocurrency Under Shariah (And What It Means for Your Zakat)

Every Ramadan now brings the same question to a growing number of Muslims: I hold Bitcoin, Ethereum, or some other coin, do I owe zakat on it? Most people expect a yes or no answer. The honest answer is that scholars have not settled on one, and the disagreement is not really about crypto at all. It is about a much older question: what does Shariah actually count as wealth?

That question decides everything downstream. If cryptocurrency is not wealth in the eyes of Shariah, zakat never enters the conversation, the same way zakat is not owed on a sentimental keepsake or a borrowed tool. If it is wealth, or something legally close enough to it, then the ordinary rules of zakat, rate, niṣāb, and a full year of holding, apply exactly as they would to gold or cash. So before any calculator or percentage matters, the real work is figuring out what a coin sitting in a digital wallet actually is.

Why "wealth" is not as obvious as it sounds

Classical Hanafi fiqh sets two conditions for something to count as māl (recognized wealth): it must be an 'ayn, a tangible entity with real, external existence, and custom ('urf) must treat it as something to be used and preserved. Imam Kamal al-Din Ibn al-Humam put it plainly:

لِأَنَّ الْمَالَ عَيْنٌ يُمْكِنُ إِحْرَازُهُ

"For wealth is a tangible entity capable of being possessed." — Fatḥ al-Qadīr, Bāb al-Bayʿ al-Fāsid, Vol. 6, p. 428.

A gold coin passes this test. A house passes it. A cryptocurrency, by its nature, does not. It has no external, tangible existence, it is a set of digital codes recorded on a ledger. That single observation is why a large number of contemporary scholars, including Darul Uloom Karachi, have ruled crypto's trade impermissible in the first place: if it is not māl, ordinary sale and purchase rulings do not straightforwardly apply to it either.

But "not māl" is not the end of the analysis. Islamic law recognizes categories of value beyond the tangible 'ayn, and this is exactly where the most detailed contemporary research on crypto has focused its attention.

The case for calling crypto a "haqq"

A treatise by Mufti Waseem Akhtar Al-Madani and Syed Muhammad Basiq Raza, two researching scholars at Darul Ifta Saylani, Karachi, titled Cryptocurrency: A Jurisprudential Analysis (کرپٹو کرنسی: ایک فقہی جائزہ), works through the classical Hanafi categories one at a time. Crypto is not māl, for the reason above. It is also not manfa'ah (usufruct or benefit), because manfa'ah always attaches to an existing 'ayn, the way rent attaches to a house that remains intact, whereas crypto has no 'ayn to attach to.

That leaves one category standing: ḥuqooq, rights. And within rights, Hanafi jurists distinguish two kinds. Some rights exist only to remove harm, such as the right of pre-emption (ḥaqq al-shuf'ah), and taking compensation for giving them up is not permitted. Other rights are aṣālatan thābit, established in their own right, such as a wife's right to relinquish her right of khiyār in marriage in exchange for a payment, a compensation jurists have permitted.

The authors' conclusion places cryptocurrency in this second, compensable category:

کریپٹو بطور حق ... اب اس کا عوض لینا شرعاً جائز ہوگا

"Crypto, in its capacity as a haqq, its compensation will therefore be permissible under Shariah." — Al-Madni & Raza, Cryptocurrency, A Jurisprudential Analysis, Darul Ifta Saylani, 13 June 2025.

A coin is a specific digital number exclusive to its holder, and no one else may dispose of it without permission. That right was acquired through the owner's own effort, mining, staking, or purchase, which places it among rights established in their own right rather than rights that exist only to remove harm. The authors attach two conditions to this permissibility: domestic law must not prohibit its trade, since exposing oneself to legal jeopardy is itself discouraged in Shariah, and its use must not be for a purpose that is definitively unlawful.

This is the hinge the rest of this discussion turns on. Once crypto is classified as a haqq rather than dismissed as nothing at all, the question of zakat stops being closed by default, and starts depending on whether zakat can attach to a right the way it attaches to tangible wealth.

The opposing view: Darul Uloom Karachi

Not every authority agrees that a haqq classification helps. Darul Uloom Karachi, under Mufti Muhammad Taqi Usmani and colleagues, issued a fatwa on 10 June 2026 declaring cryptocurrency, tokens, and stablecoins impermissible, on the grounds that none of them meet the Shariah definition of māl at all, and are merely fictitious digital figures. Both positions agree crypto is not māl in the tangible sense. The disagreement is what happens next: Mufti Waseem finds an alternative route to permissibility through ḥaqq, while the Darul Uloom Karachi fatwa does not recognize that alternative route as sufficient. This is a live, credible difference of opinion between serious scholars, not a settled matter with one side simply being wrong.

A middle path: "conventional value" and constructive possession

The Shar'ee Council of India, Bareilly Sharif, reached a more layered position at its 20th Fiqhi Seminar. Decentralized cryptocurrency such as Bitcoin, having no external existence, is not māl, in agreement with the above. But a government-issued digital currency, such as India's E-Rupee, was placed in a different category: thaman iṣṭilāḥī, conventional or customary value, since a government designates it and the public accepts it as a medium of exchange.

العرف قاضٍ على القياس

"Custom is decisive over analogical reasoning." — Shar'ee Council of India, Bareilly Sharif, 20th Fiqhi Seminar.

The same seminar made a second point that matters a great deal for the practical side of this question: crypto accumulating in a digital wallet counts as qabḍ ḥukmī, constructive possession. You do not need to hold a coin in your hand for possession to count, the same way a bank balance is possessed wealth without a single banknote changing hands. Where an amount equal to the niṣāb of E-Rupee is present, zakat becomes obligatory on it, subject to the usual conditions.

What the global bodies say

The International Islamic Fiqh Academy (IIFA), at its 24th session in 2019, did not close the question either. Its Resolution No. 237 states plainly that it remains unresolved whether electronic currency is a commodity, a benefit, or a financial asset. Academic research has moved further than the institutional bodies in places: a 2023 peer-reviewed paper by Ali, published in the Global Business and Economics Review, concluded that Bitcoin qualifies among zakatable assets, drawing on the IIFA's own 1986 position that a paper currency's value comes from community trust rather than the paper itself, an argument that transfers naturally to a currency with no paper at all. The National Zakat Foundation (UK) takes a simpler, practice-oriented stance: any cryptocurrency or token bought with the intent of resale is always zakatable, regardless of how its underlying nature is classified.

The precedent that closes the loop

The strongest support for treating a haqq as zakatable does not come from a crypto-specific ruling at all. It comes from a 2022 ruling by Majlis Tehqiqat-e-Shariah, Darul Ifta Ahlesunnat (Dawat-e-Islami), on an entirely different modern problem: booking a flat that has not been built yet. Under a contract of istiṣnāʿ (a manufacturing contract), a person who books a flat acquires only a ḥaqq-e-milk, a right of ownership, against the builder, since the flat itself has no existence at the time of the contract. The ruling states:

بُک کروانے والوں نے اگر مال تجارت کے طور پر لیا ہے، تو شرائط پائے جانے پر اس کی زکوۃ کے وہ خود ذمہ دار ہیں۔

"If those who book a flat have taken it with the intention of trade, then, subject to the conditions being met, they themselves are liable for its zakat." — Majlis Tehqiqat-e-Shariah, 10 November 2022.

This establishes, in an already-accepted ruling with no connection to crypto, that zakat can attach to a ḥaqq-e-milk and not only to 'ayn, provided there is trading intent. Line that up with Mufti Waseem Akhtar Al-Madani's classification of crypto as a haqq acquired through the owner's own effort, and the flats ruling becomes the missing link: a right can be zakatable, a coin can be a right, therefore a coin held with trading intent can be zakatable, without ever needing to force it into the category of tangible māl in the first place.

The practical rules, once zakat applies

Every source that holds crypto zakatable converges on the same mechanics used for any other form of monetary wealth:

• Rate: 2.5%, one-fortieth, the standard Shariah rate for currency and monetary wealth.
• Niṣāb: either the gold standard (85 to 87.48 grams) or the silver standard (595 to 612.36 grams). The silver standard is generally considered more favorable to the poor, since it is reached at a lower value.
• Ḥawl: a full lunar (Hijri) year during which the holding stays at or above the niṣāb.
• Valuation: zakat is due on the full market value of the holding on the zakat date, not merely on the profit made. Zakat is a wealth tax, not a capital-gains tax, a distinction that trips up a lot of first-time crypto zakat calculations.
• Possession: coins sitting in a digital wallet count as constructive possession (qabḍ ḥukmī). Physical possession was never a requirement, in crypto or otherwise.

Where this leaves you

If cryptocurrency is ruled to be non-māl altogether, as Darul Uloom Karachi holds, the question of zakat does not arise at all, in the same way it would not arise for something with no recognized value. But if it is recognized as a haqq, as Mufti Waseem Akhtar Al-Madani and Syed Muhammad Basiq Raza have argued in careful detail, then the Majlis Tehqiqat-e-Shariah's ruling on flats gives that right a clear path into zakat, provided it is held with trading intent.

Neither position is a fringe opinion. This is a genuine, live difference between serious scholars working from the same classical framework, and the honest thing to do with a genuine difference is not to pretend it has been resolved. Hold your coins with the same seriousness you would hold gold or cash, calculate what 2.5% of their full value would be if a full lunar year has passed above the niṣāb, and take the specific question of your own holdings to a mufti you trust. Wallahu Ta'ala A'lam.

Why this matters beyond the fatwa

This is the exact kind of question that sits at the intersection of two worlds Cybrum's founder has spent years working across: Islamic scholarship and applied technology. A crypto exchange, a fintech product, or a Muslim-facing app that touches money eventually has to answer this question for its own users, in a calculator, a disclosure, or a feature that decides whether to prompt someone for zakat at all. If you are building something in that space and need it scoped with real fiqhi grounding instead of a guess, book a free AI audit and we will map out what a Shariah-aware build actually requires.