Fitch: Diverging Sharia Views Are Shaping Crypto Rules Across Islamic Markets

Cryptocurrency is treated very differently across major Islamic-finance markets. According to Fitch Ratings, differences in regulation and Sharia interpretations have fragmented the crypto asset market.

In a September 14 report, Fitch said crypto markets will grow gradually in countries where regulators have created clear rules or where national Sharia authorities have approved certain digital assets.

However, adoption remains uneven. Islamic scholars do not agree on whether cryptocurrencies are permissible, and global Islamic-finance organizations have not yet created comprehensive rules covering all types of crypto assets. Banks are also cautious about getting directly involved.

As a result, the same cryptocurrency can be treated differently depending on the country.

Malaysia is one of the few countries with a formal system for deciding whether digital assets comply with Sharia. Fitch said Malaysia’s Securities Commission Shariah Advisory Council approved several cryptocurrencies as Sharia-compliant between 2020 and the first half of 2026, including Bitcoin, Ethereum, XRP and Stellar.

As at the end of the first half of 2026, 10 crypto businesses, including exchanges and custodians, were regulated by the Securities Commission. Regulated exchanges handled more than $4 billion in trading in 2025, a 23% increase from the previous year.