Islamic approach toward purification of transaction with cryptocurrency

Abstract

This paper presents a qualitative study that examine the perception of users on Islamic approach toward
\npurification of transaction with cryptocurrency. Bitcoin is has been used as a case study which is one of the
\ntype of cryptocurrency. There are huge discrepancies from many Islamic school of thought about
\ntransaction with bitcoin. Specifically, some school of thought viewed it as a tool used for illegal purposes
\nand that the global public already uses Bitcoin mostly for illegal and non-Shari’ah-compliant purposes
\nunder Islamic perceptions. As a result, this study developed an interview-qualitative research approach in
\norder to examine how the negative perceptions of cryptocurrency from Islamic views cnd be purify. Sample
\nof Eight informant were used in the study. The finding of this study indicated that the use of cryptocurrency
\nas a legitimate as any payment method. It is also argued that it facilitated transactions and cut the normal
\ncost of international money transfer, and some Muslim countries are actively encouraging the use of
\ncryptocurrency due to its easy use and transparency. This has been also supported by “hadith”. Finally, the
\nanalysis also confirmed that from the Shari'ah point of view, cryptocurrencies are as compliant as fiat
\nmoney and ought to be accepted as another mode of payment that can be used in transaction as its value can
\nbe measured and quantified. Therefore, this study has contributed in understanding the Islamic views
\nbehind the implementation of cryptocurrency.