Q: Do we pay Zakat on cryptocurrencies?
A: Any cryptocurrency or token purchased to resell will always be Zakatable. Zakat is due on the market value on one’s Zakat anniversary. The cryptocurrency value should be converted into one’s local currency at the time of calculation.
If a cryptocurrency is not purchased to resell, a coin currency such as Bitcoin, Litecoin, Ripple, Dogecoin, etc. will still be Zakatable because of their utility as currencies within their ecosystem (they are like cash).
Zakat on tokens not purchased to resell will depend on the nature of the token and what it represents.
Allah knows best
Approved by Mufti Amjad 13th August 2023