Yes.
You do pay zakat on your cryptocurrency if it’s priced higher then 87.48 grams (7.5 tola) of gold and 612.36 grams (52.5 tola) of silver, and held for 12 months.
Take the value of your Crypto and convert it to gold. If your crypto wallet’s value is more than the value of 7.5 Tola of gold and 52.5 Total of Gold for a year or more, then you must pay 2.5% of your cryptocurrency in Zakat for the year.
- Zakat is due on the market value of your Crypto.
- Regardless of whether your cryptocurrency holdings are tokens (utility or work) or exchangeable coins, both are liable for Zakat.
If you’ve had a consistent value greater than 85 grams of gold in your wallet on the month’s end for an entire 12 months, then you will pay Zakat on the total value of your wallet. Pay 2.5% of your wallet’s value either in the same cryptocurrency or in it’s value of fiat currency or precious metals.
The Eight Kinds of People Who Receive Zakat
- The poor (al-fuqarâ’), meaning low-income or indigent.
- The needy (al-masâkîn), meaning someone who is in difficulty.
- Zakat administrators.
- Those whose hearts are to be reconciled, meaning new Muslims and friends of the Muslim community.
- Those in bondage (slaves and captives).
- The debt-ridden.
- In the cause of God.
- The wayfarer, meaning those who are stranded or traveling with few resources.
Indeed, [prescribed] charitable offerings are only [to be given] to the poor and the indigent, and to those who work on [administering] it, and to those whose hearts are to be reconciled, and to [free] those in bondage, and to the debt-ridden, and for the cause of God, and to the wayfarer. [This is] an obligation from God. And God is all-knowing, all-wise.
Al-Tawbah, 9:60
How Much Zakat I have to Pay on Crypto?
Let’s calculate with the prices as of 19 May 2024, as for future it may vary. Price of 1 gram of gold as of now is around Rs 19,145. so that makes Rs 1,674,804 (1.67m). So if your crypto savings are greater then Rs 1.674 m you have to pay zakat on the total crypto asset you have.
Meme Coins and Zakat ?
A general consensus on zakat is that anything which has real value falls under the zakat category, while some say that as apart from the famous coins there are many which currently can not be used to buy real world assets. so they may be exempted from zakat. However, any meme coin showing value in $ can be always converted to a stable coin and that that tangible value in real world, so in my humble opinion you should pay zakat for that aswell.
Do check out this detailed Zakat on Cryptocurrency explanation on Islamic Guru Finance.