All perfect praise be to Allah the Lord of the Worlds. May His peace and blessings be upon our Prophet Mohammad and upon all his family and companions.
Currencies and banknotes – if they are not gold or silver – are not considered intrinsic values themselves. Rather, they are considered values insofar as they represent compulsory purchasing power. Thus, the rulings pertaining to gold and silver, such as Riba (usury/interest), Zakat, and others, apply to them as long as they are in circulation. However, if their usage ceases and they no longer serve as a price for goods, then their monetary status is removed, and they become a commodity among commodities.
In this regard, Al-Imam Al-Haramayn Al-Juwayni, may Allah have mercy on him, Says: "And if the Fuloos (copper coins) become worthless, and the ruler's crier announces the prohibition of dealing with them, then they immediately turn into commodities without dispute" [Nihayat Al-Matlab/ Vol.6/P.22]. So, if dealing with it is abolished, its monetary status is removed. Its situation then becomes like that of other commodities for which the rulings of exchange (Sarf) do not apply. Therefore, it is permissible to sell it for the current currency with a premium (Tafadul), and for whatever the two transacting parties agree upon.
In conclusion, it is permissible to sell the abolished currency with a premium, as it becomes a commodity like other goods after its abolition, and a tangible asset like other assets. Thus, the rulings related to Riba, Zakat, Sarf (currency exchange rules), and so forth do not apply to it. And Allah The Almighty Knows Best.
