The Stance of the Governmental Jurisprudence towards Virtual Currency (Part 1)

The Epistemology of Virtual Currency

The jurisprudential analysis of the virtual currency, either from individual or governmental jurisprudence stances, should be based on an accurate epistemology.

News ID: 443637

Date: 25 February 2019 - 09:12

RNA -Virtual currency, according to the Governmental Jurisprudence, has different dimensions, and its analysis from the stance of the individual jurisprudence shouldn’t render its examination from the position of governmental jurisprudence redundant. A question has recently raised across the society is that whether the use of Bitcoin, and generally virtual currency, is regarded legitimate by the Jurisprudence or not.

Although the use of virtual currency should be studied more thoroughly from the stance of individual jurisprudence (Fiqh), its analysis from the stance of the governmental jurisprudence is of higher significance.

Money can be regarded as the main factor required for the development and growth of economy, and in its absence, economy will collapse. Development of IT has influenced all the dimensions of man’s life like economy. The entry of IT into economic transactions has resulted in the creation of the electronic currency.

The next phenomenon rose in the virtual space, after electronic currency, is virtual currency. The virtual currency is the money issued in the virtual space, and not published by the monetary authorities; however, with its prevalence, it has obtained the functions of its real counterpart.

A question has recently been raised across the society is that whether the use of Bitcoin, and generally virtual currency, is regarded legitimate by the Jurisprudence or not.

This money is solely published in the virtual space and not by the monetary authorities like central banks. Bitcoin can be earned in two ways. The first is to purchase it using/paying the common currencies such as Rial, Euro, Dollar and etc.

The second is to obtain Bitcoin through accounting and providing support for Bitcoin network which both require the consumption of electricity and time; therefore in order to generate motivation in accounting and support of the said network, some specific number of new Bitcoins are paid as the wage.

The principal difference of Bitcoin and real currency/money is that there is no real person or legal entity as the issuer and the creditor of Bitcoin, however; Bitcoin acquires its credit through its own accurate design and transparency of performance.

The Epistemology of Virtual Currency

The jurisprudential analysis of the virtual currency, either from individual or governmental jurisprudence stances, should be based on an accurate epistemology. Through epistemology, the process of such phenomenon should critically be explored and its different dimensions ought to be assessed and adapted to different jurisprudential criteria.

Virtual Currency and Individual Jurisprudence

When virtual currency is approached from the stance of individual jurisprudence, some important issues are dealt with, including the ownership of virtual currency, aleatory essence of the transaction conducted using the virtual currency, attribution of such asset to the money acquired through wrong/illicit ways and other jurisprudential rules. Regarding the legitimacy of the virtual currency, the analysis of the aforesaid issues is highly significant.

To be continued...

Mahdi Khosh Akhlagh