Oman’s Multi-Million Dollar Crypto Investments Spark Debate Over Sharia Compliance

The Sultanate of Oman has stepped up its involvement in the crypto market with multi-million dollar investments this month. Located on the southeastern border of the Arabian Peninsulae, Oman aims to become a leading crypto Hub in the competitive West Asian region.

According to a report from Forbes, the government has announced plans to invest about 1.1 billion dollars in crypto mining projects.

One of the prominent investments was a $300 million deal with the Phoenix Group, an Abu Dhabi engineering firm. As part of the partnership, the company will establish Green Data City, a 150 MW crypto-mining farm. It will be Oman’s first licensed crypto-mining firm.

Furthermore, a local Omani company, Exahertz International, along with local authorities, got the green light for a $370 million crypto-mining farm. They also aim to set up 15,000 more machines by October. It is a “major milestone” to boost the country’s digital economy, Hamoud al-Maawali, Oman’s Minister of Information Technology, Communications and Transport, said.

In a recent press, the Chairman of Oman’s Authority for Public Services Regulations, Sheikh Mansour Bin Taleb Bin Ali Al Hinai, stated:

“This initiative aligns with our goal to diversify our economy, integrating modern technologies while upholding our commitment to ethical and sustainable practices.” 

Notably, Oman’s crypto adoption has initiated debates about its alignment with Sharia. Including financial activities, Sharia is concerned with proper Islamic conduct in various aspects. Sharia law includes a set of rules that define the moral approval of financial transactions, which are called halal, and the impermissible, called haram.

Some Islamic scholars argue that the speculative nature of crypto assets makes them haram. Many Islamic communities in countries such as  Indonesia, Egypt, and Turkey have supported this stance. On the contrary, cryptocurrency supporters argue it is halal because it does not accrue interest, known as riba.

Crypto Adoption In Islamic Nations

Despite the disagreement of Islamic scholars, Muslim-majority countries are rapidly adopting cryptocurrencies. A predominantly Muslim region, the Middle East and North Africa (MENA) was the fastest-growing crypto space last year, according to a report by Chainalysis.

Four Muslim-majority countries were among the top 20 crypto adopters. Moreover, India and Nigeria, which have Muslim communities, were part of this list. However, the regulatory landscape for cryptocurrencies in the Muslim world is a mixed package.

Countries such as the UAE has become the attractive crypto hub for investors. In contrast, Turkey allows cryptocurrency trading but bans their use for financial intermediaries and payments.