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Zakat On Crypto Investment
When we invest in crypt then what would be the case with Zakat on production as it’s value changes everyday.
For example I invested 90 thousand in crypto and it’s value changes to 40k in next 10 days. And then increases to 1 lac after 25 so technically I have gained profit of 60k and I would have to give 5% zakat on it?
In actual sense I only had profit of 10k but because it’s value changes so it’s looking like 60k. Kindly guide
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17 Replies
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Zakat On Crypto Investment
updated 3 years, 6 months ago
4 Members
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17
Replies
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In summary you will pay 10% zakat on production which is 10,000 in your case after you have realized the gain (once round trip trade is complete). Once a year, you will also pay 2.5% zakat on wealth which includes the total current value of your investments.
Please enter appropriate numbers in our Zakat Calculator after reading description for each box as it will tell you exactly how to calculate your zakat. When you reach the end, it will generate a statement showing you exactly what you owe after any applicable deductions, and what percentage was applied to what. It’s also a great way to learn the sharia of zakat.
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Ok but zakat won’t be 5% in crypto case. As we are investing and at the same time working on it too.
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Also crypto currency is just like gold and other currencies like dollar etc so it should be considered in wealth why do we consider it in production. We buy coins it’s value increase with time. Same as price of gold and dollar increases. Kindly guide in detail about Crypto
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I am not an expert on this matter, but Ghamidi Sahab has explained this in Principle that it is ultimately for the professionals of this field to decide whether it is inclined more towards production based earning or forms direct wealth of a person. One can do ijtihaad based on the best available information or consult experts in the relevant field to address this issue in the light of principles explained in the following videos:
Please refer to the video below from 1:10:37 to 1:12:14
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Please also refer to the video below from 1:18:50 to 1:20:23
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I guess @faisalharoon bhai has understanding about crypto. Let’s wait for his response
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@UmerQureshi someone buys a plot for 1 lac it’s price increase to 1 lac 40 thousand after 2 months he sells that and buys another plot for 1 lac 40 thousand and then sells it when it’s price increases. What would be the applicability of Zakat in this case? Zakat on production will be applied if it crosses the nisab?
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If you have invested in any asset (stocks, crypto currency, gold, real estate, etc.) then it’s considered your wealth and you pay 2.5% on the current value of all your assets once a year if you meet the nisab and other conditions as explained in the Zakat Calculator.
However, if you have a trading business where you regularly buy and sell any kind of an asset then for every round trip trade (buy and sell) you pay 5% or 10% production zakat depending on where or not you’re also putting in any significant effort. This is in addition to 2.5% you pay on the total value of your wealth once a year. Again certain conditions apply. One could make an ijtihad and exclude the value of their trading account from the wealth zakat considering it the means of production if that account is dedicated to their business.
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Didn’t understand the last sentence.
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Means of production are included in wealth zakat, how can we exclude it. Kindly explain the last point
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I suggest that you take a few minutes to read through the description posted in the Zakat Calculator. It is clearly explained there on the very first screen.
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Yea I have gone through that
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Means of production are excluded in both production and wealth zakat? I thought that it’s it was only excluded in production zakat.
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Also in case of crypto I am confused by applicability of 5% or 10% . It needs the skills, analysis and time to time update. When to invest when to sell. So will 5% be applicable on it. I need your opinion as Ghamidi sb say when in confusion ask some knowledgeable one.
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Asset ki nisab silver par kyo gold kyo nahi? Jaha okiya silver ke the to dinar ya dirham gold ke the cancer currency in prophet time
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Kya zakat majid ke construction me use kar sakte he & second one masjid ke imam ki salary zakat se ada kar sakte he?
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