Zakat on Cryptocurrency

 

Paying Zakat Through Digital Assets: PPZ’s Innovative Step with Sharlife

In today’s fast-evolving world of technology, opportunities continue to emerge in various aspects of life, including financial transactions and religious obligations. Recently, the Pusat Pungutan Zakat (PPZ) launched a groundbreaking initiative, allowing zakat payments to be made using digital assets, including cryptocurrencies. Adding to this innovation, Sharlife has been appointed as the first official zakat collection agent to facilitate payments through cryptocurrencies.

Embracing Technology in Worship

Islam encourages us to embrace technological advancements that bring benefits. In this context, the use of cryptocurrency for paying zakat is a significant leap, merging cutting-edge technology with religious practices.

Cryptocurrencies, widely recognized as a modern investment vehicle, are now being acknowledged as a means of fulfilling religious duties. Through this initiative, PPZ and Sharlife aim to provide a platform for Muslims to perform zakat obligations seamlessly, keeping pace with the rapid development of the digital world.

Why Cryptocurrency is Zakatable?

AZKA-PPZ’s Perspective on Zakat and Cryptocurrency

The Akademi Zakat (AZKA) under PPZ has emphasized that cryptocurrency, like other modern assets, is subject to zakat if it meets the criteria outlined in Shariah. According to AZKA-PPZ, cryptocurrencies are classified as al-Mal Mutaqawwim (valuable wealth) if they meet the following conditions:

• They have attached value and are widely accepted as a means of exchange or investment.

• Ownership of the cryptocurrency is clear and legitimate.

• They can be utilized and stored for future use.

• There is no explicit prohibition on their use in Shariah.

Some scholars assert that cryptocurrencies can be classified as "al-Mal" (wealth) under Islamic law, thus making them subject to Zakat. 

How to pay Zakat with Sharlife

1. Go to page https://sharlife.my/zakat-asset-digital/ppz

2. Add your wallet address. 

3. Tick the box to confirm that the token has been held for over a year (hawl).

4. Review your asset breakdown. 

5. Next, select payment method.

6. Fill in your personal details to complete the zakat application process.

7. Click ‘Pay Zakat’ to proceed with the payment.

8. A payment receipt will be generated.

Conclusion

Paying zakat is a fundamental obligation for every eligible Muslim, serving as a means to purify wealth, support the less fortunate, and uphold social justice. As technology evolves, so too do the ways we fulfill our responsibilities, making it easier and more accessible for everyone to perform this vital act of worship. 

The introduction of cryptocurrency as a mode of zakat payment reflects Islam's adaptability to modern advancements, ensuring no Muslim is left behind in meeting their obligations. Whether through traditional means or innovative platforms like Sharlife, the essence of zakat remains unchanged: to share our blessings and seek Allah’s barakah in our wealth. Allah says in the Quran:

خُذْ مِنْ أَمْوَٰلِهِمْ صَدَقَةًۭ تُطَهِّرُهُمْ وَتُزَكِّيهِم بِهَا وَصَلِّ عَلَيْهِمْ ۖ إِنَّ صَلَوٰتَكَ سَكَنٌۭ لَّهُمْ ۗ وَٱللَّهُ سَمِيعٌ عَلِيمٌ (١٠٣)

Meaning: “Take, [O Muhammad], from their wealth a charity by which you purify them and cause them increase, and invoke [Allah’s blessings] upon them. Indeed, your invocations are reassurance for them. And Allah is Hearing and Knowing.”

(Surah At-Tawbah: 103)

Let us remember that zakat is not just a duty but a privilege—an opportunity to grow closer to Allah and contribute to the well-being of our community. By embracing new technologies, we can fulfill this obligation with sincerity, ease, and relevance in today's digital age.