Sharia Interpretations Fragment Crypto Market Across Islamic Finance Markets
Cryptocurrency adoption in Islamic finance markets remains uneven due to differences in regulation and Sharia interpretations. Fitch Ratings states that countries where regulators have created clear rules or national Sharia authorities have approved certain digital assets will see gradual growth.
Malaysia is one of the few countries with a formal system for deciding whether digital assets comply with Sharia, approving several cryptocurrencies as Sharia-compliant between 2020 and the first half of 2026. The country's regulated exchanges handled more than $4 billion in trading in 2025, a 23% increase from the previous year.
The UAE has taken a different approach, combining regulation with a national Sharia ruling on Bitcoin, issued by its Higher Shari'ah Authority in 2025. Virtual-asset transactions involving entities regulated by Dubai's Virtual Assets Regulatory Authority reached almost $680 billion in 2025.