The thread below is an excellent response to Shaykh Joe Bradford’s critique of hard to create forms of money such as gold and Bitcoin.

Yes, riba transactions can occur with any type of money (fiat, gold, bitcoin, etc.), but the key point is that under the current fiat monetary standard (an easy to create form of money that banks create & control) the dynamics are fundamentally different:

a) You cannot separate riba from fiat, because riba is the very mechanism through which fiat money is primarily brought into existence, namely, through interest based (riba based) loans. Everyone holding fiat currency is affected by these riba based loans. In other words, the purchasing power of the fiat currency you hold decreases, even if you are not a direct recipient of the specific riba loan that created that particular batch of fiat money.

b) On the other hand, under a gold or bitcoin standard, these forms of money are not created or brought into existence through riba based lending (they come into existence through energy expenditure).

Again, I acknowledge that there are many riba based financial products being built on top of bitcoin, just as there are on top of gold (and muslims should avoid these). However, the key point is that the actual monetary units themselves do not come into existence through riba based lending, unlike fiat currencies.

c) We cannot say for certain (Allah knows best) but the following hadith about the “dust of riba” seems to describe fiat currency quite accurately:

The Messenger of Allah (peace and blessings be upon him) said:

“A time will surely come upon people in which none will remain but that he consumes riba. If he does not consume it, he will be afflicted by its dust.”

Sunan Abī Dāwūd 3331

Grade: Ṣaḥīḥ (authentic) according to Al-Suyūṭī

Saifedean Ammous on how fiat currencies are brought into existence via riba lending: