Question Summary:
Bit Club Network – Bitcoin mining

Question Detail:

There's a company called Bit Club Network - you could read the faqs here https://bitclubnetwork.com/faq.html

Answer :

In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.

  The above website says: “To join BitClub Network you must have Bitcoin to pay with! We do not accept anything other than Bitcoin so depending on the country you live in you must convert your currency into Bitcoin and then use the Bitcoin to sign up for BitClub Network.”

 “We pay mining earnings every day! However, because of the variance described above we pay out earnings based on the average of the previous 10 days and then adjust it accordingly for the next 10 days. When you first purchase a share of any pool you will not start earning bitcoin for 30 days. This is how we stabilize the payout and it also allows us a nice window to purchase and install new equipment. After these initial 30 days you begin earning bitcoin daily for 1,000 days.”

  “Very important to understand that we DO NOT guarantee a mining share will have a set return. In fact, you will never hear us make any claims about how much you will earn from having a share in our mining pool because the truth is we don't know. Bitcoin mining is very complex and with the difficulty level constantly moving up every 10 days and new hashing power always entering the space there is no way anyone can predict accurately an ROI. Especially with our business model that requires re-purchases or more simply daily maintenance fees.”

     The Darul Iftaa has been inundated with queries regarding Bitcoins and cryptocurrencies. This is a relatively new concept with many angles and dimensions to it. We also observe the reaction of few countries on Bitcoins. JPMorgan and other financial institutions have expressed concerns on Bitcoins which could be genuine concerns or motivated by other personal considerations.

  Bitcoins and other forms of crypto currencies are electronic modes of currencies. It is incorrect to completely dismiss electronic modes of money as accepted modes of currency due to them not being backed by commodity.

  Fiat money and fiduciary money are also not backed by commodities but are accepted modes of currencies. The possibility of electronic modes of currencies being an accepted mode of currency cannot be ruled out.

  Apart from the fiqhi classification of electronic currencies, urf (accepted norm) is also an important consideration in issuing a ruling. Electronic currencies are in the infant stages.

Hence, the issue of urf is also being observed for further consideration.

  We advise you to suspend your shares and investments for now.

And Allah Ta’āla Knows Best

Mirza Mahmood Baig

Student Darul Iftaa

Jeddah, KSA

Checked and Approved by,
Mufti Ebrahim Desai.