Blockchain Technology and Islamic Finance

Abstract

Financial technology (FinTech) has emerged as the application of innovative and disruptive technologies to provide financial services, gaining significant prominence in the late 2010s. The genesis of FinTech can be traced back to the global financial crisis of 2008, which necessitated a re-evaluation of traditional financial systems. Islamic financial systems emerged as a resilient response to this crisis, offering alternative solutions. This chapter embarks on a comprehensive review of academic research in the domain of Islamic financial technology, with a particular focus on the integration of blockchain management. Forecasts indicate that global cumulative investments in FinTech are poised to surpass $1.5 trillion over the next 3-5 years. Concurrently, the conventional banking and finance industry faces a notable dearth of innovation, presenting formidable challenges to banks and financial institutions worldwide. This study aims to address this innovation gap by investigating the potential of blockchain technology to revolutionize Islamic finance.