The Sultanate of Oman, located on the southeastern coast of the Arabian Peninsula, is accelerating its embrace of cryptocurrencies this month after making multi-million investments. With a strategy to become a digital hub in a competitive region, the West Asian nation has made some major steps.
In August, the Omani government announced close to $800 million in investment in crypto-mining operations. This included a $300 million agreement with the Abu Dhabi-based Phoenix Group to develop a 150-megawatt crypto-mining farm with Green Data City—Oman’s first licensed crypto-mining entity—which is set to launch next year. Additionally, Muscat approved a $370 million farm operated by Exahertz International, aiming to install 15,000 more machines by October.
In a statement, Said Hamoud al-Maawali, Oman’s Minister of Transport, Communications and Information Technology, stated that these investments are a “major milestone” in the nation’s efforts to “help accelerate the growth” of its digital economy.
The move comes at a time when the region is embracing cryptocurrency, but the question of whether or not it is “halal” or “haram” under Islamic law has been debated. Sharia law has certain principles around finance that define if something is morally permissible or not. For some Islamic scholars, the often speculative nature of crypto makes it impermissible, leading to fatwas issued by prominent Islamic groups in Turkey, Egypt and Indonesia.
However, others believe that cryptocurrencies can be deemed “halal” as there is no interest (riba) attached to owning tokens like Bitcoin, and the widespread acceptance of crypto as currency may support the case.
Despite the ongoing debate, Muslim-majority countries have been the biggest adopters of cryptocurrency in recent years. According to a report by Chainalysis in October 2022, Middle East and North Africa (MENA) were the fastest growing crypto markets. Additionally, four of the top twenty adopters on Chainalysis’ Crypto Adoption Index were Muslim-majority countries, with other states like India and Nigeria having large Muslim populations.
The regulatory landscape across the Muslim-world is varied. On one hand, countries like the United Arab Emirates have established themselves as crypto-friendly hubs. Meanwhile, other countries like Turkey allow trading but have banned payments and financial intermediaries from using crypto.