Review of Some Existing Shariah-Compliant Cryptocurrency

Aliyu, Ahmed; Bakar, Kamalrulnizam Abu; Matsuda, Gen; Darwish, Tasneem; Abdullah, Abdul Hanan; Ismail, Abdul Samad; Radzi, Raja Zahilah Raja Mohd; Yusof, Azita Laily; Mohamad, Mohd Murtadha; Idris, Mohd. Yazid; Ismail, Zuhaimy; Yaacob, Ahmad Che; Herman, Herman

doi:10.24191/jcis.v6i1.2

Cited by 8 publications

(27 citation statements)

References 5 publications

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“…However, the lack of existing regulations that accommodate shariah compliance causes suboptimal supervision of operational ICA. However, shariah compliance monitoring ensures halal products and also protects investors from the moral hazard of intermediaries financing and exploiting investors’ money (Aliyu et al , 2020).…”

Section: Resultsmentioning

confidence: 99%

“…The ICAs are halal if they meet the following three criteria regarding the shariah dimension (Aliyu et al, 2020;M. M. Billah, 2022;Chong, 2021):…”

Section: Islamic Crypto Assetmentioning

confidence: 99%

“…The value of crypto assets is formed by the users who use it as an investment medium or exchange. Supply and validation transactions are not conducted by one responsible party nor by mechanism technology computing cryptography (Aliyu et al , 2020).…”

Section: Literature Reviewmentioning

confidence: 99%

“…The ICAs are halal if they meet the following three criteria regarding the shariah dimension (Aliyu et al , 2020; M. M. Billah, 2022; Chong, 2021): The cryptocurrency represents maal (wealth or precious property). The cryptocurrency has met the shariah permissibility standard. The cryptocurrency fulfils the principle of Maqasid al-Shariah (objectives of shariah ). …”

Section: Literature Reviewmentioning

confidence: 99%

“…M. M. Billah (2022) analyses the design structure, operation mechanism and shariah assessment of crypto assets based on the Maqasid al-Shariah principle but does not analyse regulations and formulate a regulatory framework for ICAs. Aliyu et al (2020) provide an overview of several shariah-compliant cryptocurrencies focusing on uncertainty and gambling. Cryptocurrency activities must adhere to Islamic shariah regulations.…”

Section: Introductionmentioning

confidence: 99%

See 4 more Smart Citations

Islamic crypto assets and regulatory framework: evidence from Indonesia and global approaches

Wiwoho,

Trinugroho,

Kharisma

et al. 2023

IJLMA

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Purpose The purpose of this study is to formulate a governance and regulatory framework for Islamic crypto assets (ICAs). A balanced regulatory framework is required to protect consumers and to encourage digital Islamic finance innovation. Design/methodology/approach This study focuses on Indonesia and compares it to other countries, specifically Malaysia and the UK, using statutory, comparative and conceptual research approaches. Findings The ICAs are permissible (halal) commodities/assets to be traded if they fulfil the standards as goods or commodities that can be traded with a sale and purchase contract (sil’ah) and have an underlying asset (backed by tangible assets such as gold). Islamic social finance activities such as zakat and Islamic microfinance activities such as halal industry are backed by ICAs. The regulatory framework needed to support ICAs includes the Islamic Financial Services Act, shariah supervisory boards, shariah governance standards and ICA exchanges. Research limitations/implications This study only examined crypto assets (tokens as securities) and not cryptocurrencies. It used regulations in several countries with potential in Islamic finance development, such as Indonesia, Malaysia and the UK. Practical implications The ICA regulatory framework is helpful as an element of a comprehensive strategy to develop a lasting Islamic social finance ecosystem. Social implications The development of crypto assets must be supported by a regulatory framework to protect consumers and encourage innovation in Islamic digital finance. Originality/value ICA has growth prospects; however, weak regulatory support and minimal oversight indicate weak legal protection for consumers and investors. Regulating ICA, optimising supervision, implementing shariah governance standards and having ICA exchanges can strengthen the Islamic economic ecosystem.

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Section: Resultsmentioning

confidence: 99%

“…The ICAs are halal if they meet the following three criteria regarding the shariah dimension (Aliyu et al, 2020;M. M. Billah, 2022;Chong, 2021):…”

Section: Islamic Crypto Assetmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%