Alexandre Bovet, Carlo Campajola, Jorge F. Lazo, Francesco Mottes · 10 authors
The functioning of the cryptocurrency Bitcoin relies on the open availability of the entire history of its transactions. This makes it a particularly interesting socio-economic system to analyse from the point of view of network science. Here we analyse the evolution of the network of Bitcoin transactions between users. We achieve this by using the complete transaction history from December 5th 2011 to December 23rd 2013. This period includes three bubbles experienced by the Bitcoin price. In particular, we focus on the global and local structural properties of the user network and their variation in relation to the different period of price surge and decline. By analysing the temporal variation of the heterogeneity of the connectivity patterns we gain insights on the different mechanisms that take place during bubbles, and find that hubs (i.e., the most connected nodes) had a fundamental role in triggering the burst of the second bubble. Finally, we examine the local topological structures of interactions between users, we discover that the relative frequency of triadic interactions experiences a strong change before, during and after a bubble, and suggest that the importance of the hubs grows during the bubble. These results provide further evidence that the behaviour of the hubs during bubbles significantly increases the systemic risk of the Bitcoin network, and discuss the implications on public policy interventions.
This paper presents Conflux, a fast, scalable and decentralized blockchain system that optimistically process concurrent blocks without discarding any as forks. The Conflux consensus protocol represents relationships between blocks as a direct acyclic graph and achieves consensus on a total order of the blocks. Conflux then, from the block order, deterministically derives a transaction total order as the blockchain ledger. We evaluated Conflux on Amazon EC2 clusters with up to 20k full nodes. Conflux achieves a transaction throughput of 5.76GB/h while confirming transactions in 4.5-7.4 minutes. The throughput is equivalent to 6400 transactions per second for typical Bitcoin transactions. Our results also indicate that when running Conflux, the consensus protocol is no longer the throughput bottleneck. The bottleneck is instead at the processing capability of individual nodes.
George Kappos, Haaroon Yousaf, Mary Maller, Sarah Meiklejohn
Among the now numerous alternative cryptocurrencies derived from Bitcoin, Zcash is often touted as the one with the strongest anonymity guarantees, due to its basis in well-regarded cryptographic research. In this paper, we examine the extent to which anonymity is achieved in the deployed version of Zcash. We investigate all facets of anonymity in Zcash's transactions, ranging from its transparent transactions to the interactions with and within its main privacy feature, a shielded pool that acts as the anonymity set for users wishing to spend coins privately. We conclude that while it is possible to use Zcash in a private way, it is also possible to shrink its anonymity set considerably by developing simple heuristics based on identifiable patterns of usage.
Die Autoren gehen der Frage nach, ob Kryptowährungen als Sachen im Sinne des ZGB aufgefasst und daran namentlich Eigentumsrechte begründet werden können. Dabei werden zunächst technische Grundlagen der sog. Blockchain-Technologie und der drei nach Markkapitalisierung grössten Kryptowährungen Bitcoin (BTC), Ethereum (Ether, ETH) und Ripple (XRP) dargestellt. Sodann wird untersucht, ob diese Kryptowährungen die Eigenschaften erfüllen, welche für die Qualifikation eines Objektes als Sache im Sinne des ZGB vorliegen müssen, und welches die Folgen einer solchen Qualifikation sind. Im Sinne einer modernen Auslegung des Sachbegriffs schliessen sich die Autoren der Auffassung an, wonach Kryptowährungen grundsätzlich als Sache und damit als Gegenstand des Eigentums zu behandeln sind.
Data stored in a blockchain is immutable and available for access by separate parties. The excellent potential residing in this technology includes security, verification, and expanded data management for healthcare records, making it ideal for a new interoperability standard. As it stands today, public blockchain technology (i.e. Bitcoin) is a secure P2P (peer-to-peer) ledger system that uses public key encryption to protect information. Once entries are created on the chain, they are immutable, making blockchain ideal for storing permanent records. Because of this, authorized members of a network are confident of their data's authenticity within the encrypted chains. The shared ledger structure provides an immutable audit trail for every transaction. In healthcare, organizations can create authenticated records and entries without needing a central authority. Each link in the chain verifies the next, traceable back to what’s called the Genesis block, a.k.a. the first block in the chain ever created.
The attempts to create an adequate model of socio-economic critical events, which, as it has been historically proven, are almost permanent, were, are and will always be made. Actually, it is a supertask, impossible to solve. However, the potentially useful solutions, local in time or other socio-economic logistic coordinates, are possible. In fact, they have to be the object of interest for a real and effective economic science. Econophysics is a young interdisciplinary scientific field, which developed and acquired its name at the end of the last century. Quantum econophysics, a direction distinguished by the use of mathematical apparatus of quantum mechanics as well as its fundamental conceptual ideas and relativistic aspects, developed within its boundaries just a couple of years later, in the first decade of the 21-st century.
Ransomware is a type of malware that encrypts the files of infected hosts and demands payment, often in a crypto-currency like Bitcoin. In this paper, we create a measurement framework that we use to perform a large-scale, two-year, end-to-end measurement of ransomware payments, victims, and operators. By combining an array of data sources, including ransomware binaries, seed ransom payments, victim telemetry from infections, and a large database of bitcoin addresses annotated with their owners, we sketch the outlines of this burgeoning ecosystem and associated third-party infrastructure. In particular, we are able to trace the financial transactions, from the acquisition of bitcoins by victims, through the payment of ransoms, to the cash out of bitcoins by the ransomware operators. We find that many ransomware operators cashed out using BTC-e, a now-defunct Bitcoin exchange. In total we are able to track over $16 million USD in likely ransom payments made by 19,750 potential victims during a two-year period. While our study focuses on ransomware, our methods are potentially applicable to other cybercriminal operations that have similarly adopted Bitcoin as their payment channel.
The second meeting of ISO/TC 307 (International Organization for Standardization Technical Committee 307: blockchain and electronic distributed ledger technologies) was held in Tokyo in November 2017.This TC is working to develop international standards for blockchain technology.This article introduces the concept of blockchain technology-the fundamental technology used for bitcoin-as well as trends in the international standardization of electronic distributed ledger technologies and some applications of blockchain technology beyond cryptocurrency.
Nicholas Stifter, Aljosha Judmayer, Philipp Schindler, Alexei Zamyatin · 5 authors
The term Nakamoto consensus is generally used to refer to Bitcoin’s novel consensus mechanism, by which agreement on its underlying transaction ledger is reached. It is argued that this agreement protocol represents the core innovation behind Bitcoin, because it promises to facilitate the decentralization of trusted third parties. Specifically, Nakamoto consensus seeks to enable mutually distrusting entities with weak pseudonymous identities to reach eventual agreement while the set of participants may change over time. When the Bitcoin white paper was published in late 2008, it lacked a formal analysis of the protocol and the guarantees it claimed to provide. It would take the scientific community several years before first steps towards such a formalization of the Bitcoin protocol and Nakamoto consensus were presented. However, since then the number of works addressing this topic has grown substantially, providing many new and valuable insights. Herein, we present a coherent picture of advancements towards the formalization of Nakamoto consensus, as well as a contextualization in respect to previous research on the agreement problem and fault tolerant distributed computing. Thereby, we outline how Bitcoin’s consensus mechanism sets itself apart from previous approaches and where it can provide new impulses and directions to the scientific community. Understanding the core properties and characteristics of Nakamoto consensus is of key importance, not only for assessing the security and reliability of various blockchain systems that are based on the fundamentals of this scheme, but also for designing future systems that aim to fulfill comparable goals.
Abstract Cryptocurrencies have experienced an exponential growth trend in the past 24 months, followed by a big crash. In the early years of the Internet, inspired entrepreneurs such as Jeffrey Bezos realized that, when something grows exponentially, it becomes ubiquitous within a short time span. Similarly to the Internet in 1994, cryptocurrencies have recently been growing at a dazzling rate, thus one can expect them to be used on a global scale very soon, in spite of the last bubble which has already burst. Alternative currencies are greeted with great enthusiasm, due to their potential to return financial power back to the people, especially in the context of general dissatisfaction and disappointment with the banking sector. They bring about several advantages, such as financial innovations, lower fees as well as increased availability to developing populations. At the same time, their high volatility and lack of supervision might imply that they only serve as complementary financing and not as a substitute of traditional banking. This article discusses the development of cryptocurrencies, including aspects related to Bitcoin, financial technology and the blockchain. Using historical data from Coinmarketcap.com between April 2013 and February 2018, I run a quantitative analysis of the distributions and evolution over time for all listed cryptocurrencies with known market capitalization. I look at the interplay between number of cryptocurrencies and market value, at growth rates, cumulative shares and volatility. I find a phenomenon of exponential growth and violent volatility, which I explain in light of cryptocurrencies’ strengths and weaknesses, as identified in the literature. I emphasize the importance of cryptocurrencies in the context of the global digital economy and I discuss future implications.
Christopher Kuner, Fred H. Cate, Orla Lynskey, Christopher Millard · 6 authors
It is not uncommon for technological developments to give rise to debates as to whether existing legal norms and regulatory frameworks will be disrupted or undermined. A recent, high-profile, example is blockchain. Most of the popular excitement about blockchain, so far at least, relates to crypto-currencies, especially Bitcoin, and related financial products such as Initial Coin Offerings (ICOs). Less visibly, but probably more importantly in the long run, a great deal of investment is going into the development of a broad range of blockchain applications in contexts ranging from registration of assets (including land) to self-executing (‘smart’) contracts. Notwithstanding widespread confusion about what exactly blockchain is or might become, blockchain and distributed ledger technologies (DLTs) have caught the imagination of governments, businesses, and private investors, and they are increasingly a focus of attention for legislators and regulators worldwide. Of specific relevance to this Journal is the question of how data protection concepts and rules will apply to blockchain and, indeed, whether it might prove to be impossible to build and deploy compliant blockchain applications to the extent that that they involve the processing of personal data. Indeed, Jan Philip Albrecht, a Member of the European Parliament who played a prominent role in the development and finalization of the European Union’s General Data Protection Regulation (GDPR), has asserted just that. In his view: Certain technologies will not be compatible with the GDPR if they don’t provide for [the exercising of data subjects’ rights] based on their architectural design. This does not mean that blockchain technology, in general, has to adapt to the GDPR, it just means that it probably can’t be used for the processing of personal data.1 We consider Albrecht’s views on blockchain as a technology for processing personal data to be overly negative. Whether personal data may be processed legitimately using blockchain technology will depend on the specific technical and organizational model that underpins a particular blockchain application. Before we can go any further, however, we need to clarify what we mean by the term blockchain. Unlike some other recently deployed technologies, such as cloud computing, as yet there is no widely accepted definition of blockchain. This is perhaps because blockchain technology is evolving rapidly and the term is used to cover a broad range of models for establishing and managing a ledger of transactions. Moreover, the term blockchain is often used interchangeably with other concepts such as DLT (see below regarding this concept). Above all, the lack of technical precision that often characterizes discussions of cryptocurrencies such as Bitcoin has resulted in widespread confusion as to what should, and should not, be regarded as an implementation of blockchain technology. It may be helpful to pare the concept down into three fundamental components. For our purposes, a blockchain is (i) a system for recording a series of data items (such as transactions between parties) that (ii) uses cryptography to make it difficult to tamper with past ledger entries, and that (iii) has an agreed process for storing one or more copies of the ledger and adding new entries. This process is usually called ‘consensus’, though that term may also be misleading. DLT refers to a particular type of blockchain system that is ‘distributed’ across several, potentially many, ‘nodes’ (ie individuals or organizations that hold a copy of the distributed ledger). ‘Consensus’ may be achieved in several different ways. These include the cumbersome and energy-intensive ‘proof of work’ model used by Bitcoin, whereby ‘miners’ compete to solve increasingly difficult computational puzzles as a basis for adding a new block to a chain, with the winner being rewarded in Bitcoin for doing so. Other key characteristics of Bitcoin are that it is open and ‘permissionless’, which means that anyone may, without authorization, use Bitcoin and, indeed, may participate in the network as a node. Widespread distribution of copies of the ledger, together with a consensus process that does not require any centralized, trusted, intermediary to manage the ledger, make Bitcoin and similar DLTs attractive as platforms for use by large numbers of parties who do not trust, indeed may not even be able to identify, each other. It is, however, the very openness, lack of permissioning, and potential anonymity that make public blockchain systems like Bitcoin problematic from a legal and regulatory perspective. For example, how can a financial services regulator check that anti-money laundering (AML) and know your customer (KYC) rules are being complied with if a large number of parties can transfer tokens between each other without involving any regulated entity or other intermediary that can be audited? In terms of data protection compliance, is each node that holds a copy of the distributed ledger a controller in respect of all personal data in the ledger? Might each node also, or instead, be a processor for the operator of every other node? What is the status of the users of an open cryptocurrency? Are they also all controllers and, if so, in what circumstances might they be excused from data protection compliance obligations because of an exemption such as that for processing in the course of a purely personal or household activity? How can controllers give instructions to processors regarding the processing of personal data when the parties may not even know who they are dealing with? Indeed, if thousands of nodes hold copies of data relating to transactions between millions of users how could they all contract with each other anyway? Given that a node or user may be anywhere on the planet, must it be assumed that any personal data in a distributed ledger might be transferred worldwide? Is the proliferation of copies of data in a DLT compatible with the data minimization principle? What happens if a data subject wishes to exercise an individual right, eg to correction or erasure of data if the relevant data are stored in an ‘immutable’ blockchain? Very few commentators have gone beyond identifying a selection of these questions and then concluding that data protection compliance in relation to blockchain is highly problematic, or simply impossible. Does this mean that Albrecht is right and that blockchain probably cannot be used for the processing of personal data? Not necessarily. Let us step away from the Bitcoin model and return to the core elements of blockchain as being a tamper-evident ledger that is established and maintained according to some kind of consensus protocol. Based on these fundamental elements, might it be possible to develop and deploy a blockchain system that is compatible with data protection by design principles? Perhaps. For example, instead of being public and permissionless, the blockchain might be set up by a consortium that is governed by rules that establish the basis on which each party will process any personal data that is included in the blockchain. Moreover, instead of a distributed consensus mechanism such as proof of work, the parties might agree to use some kind of ‘consensus by authority’ whereby one or more participants has the authority to add blocks to the chain, eg by each taking turns to do so. Indeed, that role might be outsourced to a trusted third party, perhaps even a cloud services provider that offers Blockchain as a Service (BaaS). It may even be possible to design a blockchain that is ‘redactable’ or ‘editable’ without undermining the core characteristic of being a tamper-evident ledger. These are not just hypothetical suggestions; blockchain arrangements are currently being established that have some or all of these features. So, as with many issues that arise in data protection law, the appropriate answer to the question of whether a blockchain may be used to process personal data is not binary but rather ‘It depends.’2
Dirk Andreas Zetzsche, Ross P. Buckley, Douglas W. Arner
One of the oft-noted benefits of distributed ledger technology is its security. Many commentators seem to believe that because the Bitcoin blockchain has not been hacked, somehow this means all blockchains are secure. This paper draws on recent examples to explore how risk persists when financial services are provided via distributed ledgers. We analyse the kinds of risk, how they arise and their possible legal consequences. While some technologists want to believe using blockchain will not give rise to legal liability, we demonstrate how this is not so. These liability consequences raise significant questions about how distributed ledgers should be structured, owned and, ultimately, regulated.
Motivated by the great success and adoption of Bitcoin, a number of cryptocurrencies such as Litecoin, Dogecoin, and Ethereum are becoming increasingly popular. Although existing blockchain-based cryptocurrency schemes can ensure reasonable security for transactions, they do not consider any notion of fairness. Fair exchange allows two players to exchange digital “items,” such as digital signatures, over insecure networks fairly, so that either each player gets the other's item, or neither player does. Given that blockchain participants typically do not trust each other, enabling fairness in existing cryptocurrencies is an essential but insufficiently explored problem. In this article, we explore the solution space for enabling the fair exchange of a cryptocurrency payment for a receipt. We identify the timeliness of an exchange as an important property especially when one of the parties involved in the exchange is resource-constrained. We introduce the notion of strong timeliness for a fair exchange protocol and propose two fair payment-for-receipt protocol instantiations that leverage functionality of the blockchain to achieve strong timeliness. We implement both and compare their security and efficiency.
Christopher S. Henry, Huynh, Kim, Nicholls, Gradon
Bitcoin, digital currencies and FinTech have been the subject of vigorous discussion. There has, however, been limited empirical evidence of its adoption and usage. This paper proposes a methodology to collect a nationally representative sample via the Bitcoin Omnibus Survey (BTCOS) in order to track the ubiquity and usage of Bitcoin in Canada. The paper reveals that about 64 per cent of Canadians have heard of Bitcoin, but only 2.9 per cent own it. Awareness of Bitcoin is strongly associated with men, and those with college or university education; additionally, Bitcoin awareness is more concentrated among unemployed individuals. On the other hand, Bitcoin ownership is associated with younger age groups and a high school education. Furthermore, the current authors have constructed a test of Bitcoin characteristics to attempt to gauge the level of knowledge held by respondents who were aware of Bitcoin, including actual owners. Knowledge is positively correlated with Bitcoin adoption. This paper attempts to reconcile the difference in awareness and ownership by deconstructing the transaction and store-of-value motive for holding Bitcoin. The paper concludes with some suggestions to improve future digital currency surveys, in particular to achieve precise estimates from the hard-to-reach population of digital currency users.
In this study, Bitcoin prediction is performed with Linear Regression (LR) and Support Vector Machine (SVM) from machine learning methods by using time series consisting of daily Bitcoin closing prices between 2012-2018. The prediction model with include the least error is obtained by testing with different parameter combinations such as SVM with including linear and polynomial kernel functions. Filters with different weight coefficients are used for different window lengths. For different window lengths, Bitcoin price prediction is made using filters with different weight coefficients. 10-fold cross-validation method in training phase is used in order to construct a model with high performance independent of the data set. The performance of the obtained model is measured by means of statistical indicators such as Mean Absolute Error (MAE), Mean Squared Error (MSE), Root Mean Squared Error (RMSE), Pearson Correlation. It is seen that the price prediction performance of the proposed SVM model for Bitcoin data set is higher than that of the LR model.
The use of technology has become important at this point in helping to meet human needs.Due to the increasing use of technology, new challenges are brought in the process of democracy as most people today don’t trust their governments, making elections is very important in modern democracy . Elections have a great importance in determining who will rule a nation or an organization or it can be said as it is an event that decides the fate of any nation. In modern democracy, elections are very important but large sections of society around the world do not trust their election system which is a major concern for democracy. Even the world’s largest democracies like India, United States, still suffer from a flawed electoral system. Vote rigging, hacking of EVM (Electronic voting machine), election manipulation, and polling booth capturing are the major issues in the current voting system The blockchain is said as emerging, decentralized, and distributed technology that promises to enhance different aspects of many industries. Expanding e-voting into blockchain technology could be the solution to eliminate the present concerns in e-voting system There is no doubt that the ever changing concept of the blockchain, which is the backbone of the famous cryptocurrency Bitcoin has triggered the start of a new era in the Internet and the online services. While most people focus only on bitcoin and other cryptocurrencies; there are in fact, many operations, both administrative and fintech that can only be done online/offline can now safely be moved to the Internet as online services because of immutability of blockchain. What makes blockchain a powerful tool is its smarts contracts and many features which overcomes traditional systems. Smart contracts are meaningful pieces of codes, to be integrated in the blockchain and executed as scheduled in every step of blockchain updates. E-votin, is another trending, yet critical, topic related to the online services. The blockchain with the smart contracts, emerges as a good candidate to use in developments of safer, cheaper, more secure, more transparent, and easier-to-use e-voting systems.Due to its consistency, widespread use, and provision of smart contracts logic, Ethereum and its network is one of the most suitable ones. An e-voting system must be secure, as it should not allow duplicated votes and be fully transparent, while protecting the privacy of the attendees. In this project, we have implemented and tested an e-voting application as a smart contract for the Ethereum network using the Ethereum and the Solidity language.
Miguel Pincheira, Muhammad Salek Ali, Massimo Vecchio, Raffaele Giaffreda
The recent, exponential rise in adoption of the most disparate Internet of Things (IoT) devices and technologies has reached also Agriculture and Food (Agri-Food) supply chains, drumming up substantial research and innovation interest towards developing reliable, auditable and transparent traceability systems. Current IoT-based traceability and provenance systems for Agri-Food supply chains are built on top of centralized infrastructures and this leaves room for unsolved issues and major concerns, including data integrity, tampering and single points of failure. Blockchains, the distributed ledger technology underpinning cryptocurrencies such as Bitcoin, represent a new and innovative technological approach to realizing decentralized trustless systems. Indeed, the inherent properties of this digital technology provide fault-tolerance, immutability, transparency and full traceability of the stored transaction records, as well as coherent digital representations of physical assets and autonomous transaction executions. This paper presents AgriBlockIoT, a fully decentralized, blockchain-based traceability solution for Agri-Food supply chain management, able to seamless integrate IoT devices producing and consuming digital data along the chain. To effectively assess AgriBlockIoT, first, we defined a classical use-case within the given vertical domain, namely from-farm-to-fork. Then, we developed and deployed such use-case, achieving traceability using two different blockchain implementations, namely Ethereum and Hyperledger Sawtooth. Finally, we evaluated and compared the performance of both the deployments, in terms of latency, CPU, and network usage, also highlighting their main pros and cons.
A Blockchain is defined as a distributed database which consists of records, or public ledgers of all the transactions or digital events executed and shared among participating network. In this each transaction in the public ledger is verified by consensus of a majority of the participants in the network. As soon as the information is entered, it can never be erased. The Blockchain contains a verifiable record of every single transaction ever made. [9]It was developed firstly for Bitcoin as a peer-to-peer digital currency or popularly called as 'cryptocurrency'. The ide Blockchain was coined in 2008. Since then the interest in Blockchain technology has been increasing. The reason for this increase in interest in Blockchain is its central attributes which provide security and data integrity without any third party organization in control of the transactions. Therefore it creates interesting and vast research areas, especially from the perspective of technical challenges, expectations and limitations. It was found wide range of applications in both financial and non financial market.
Before the advent of Bitcoin, there was no mechanism to allow any two willing parties to make transactions between them without any involvement of a third party. Third parties were included in the process to prevent fraud.
Kelompok Keahlian Ilmu Kemanusiaan, Fakultas Seni Rupa dan Desain, Institut Teknologi Bandung, Asep Zaenal Ausop, Elsa Silvia Nur Aulia
Cryptocurrency is virtual money or digital money or electronic money in illusion world which has no any concrete thing. This cryptocurrency has many varieties such as Litecoin, Monero, Ether, Ripple, Ethereun, Qtum, Dash, Zcash, and Bitcoin. The safety of Bitcoin is protected by Blockchain technology but it has weaknesses such as no underlying asset, no authority, and responsibility. Moreover, the ownership of this bitcoin is anonymous, and the fluctuation of this Bitcoin values was very extreme and dominated by public opinion about marketing system. Therefore, the usage of this Bitcoin in the term of investation and bussiness transaction causes pro-contra from economical experts and ulama. This research is purposed to get a representation around Bitcoin technology its self and the validation for using Bitcoin in business transaction according to Islamic sharia. The used theory is the taxonomy bussiness of haram lidzatihi and haram lighayrihi from Jumhur Ulama and constructed by Adiwarman Abdul Karim. The method of this research is literature research; its resources are taken from Al Quran, Hadith Rasulullah, classical and contemporary books also online media. This research resulted the great revolusionarytechnology, but the usage of this Bitcoin as the investation of instrument contained maysir (gambling) and the instruments of bussiness transaction contained gharar. The law position is haram lighayrihi.
Pradeep Murugan, Suraj Subramanian, Mr. V Pandarinathan Dr. D. Rajinigirinath
A new model for building massively scalable and profitable applications is emerging. Bitcoin paved the way with its cryptographically stored ledger, scarce asset model, and peer-to-peer technology. These features provide a starting point for building a new type of software called decentralized applications, or dapps. They are more flexible, transparent, distributed, resilient, and have a better incentivized structure than current software models. Centralized systems are currently the most widespread model f software applications. Centralized systems directly control the operation of the individual units and flow of information from a single center. Blockchain, a massively replicated database of transactions that's able to avoid Sybil attacks. For the first blockchain lets us achieve decentralized consensus without the use of a centralized server.
Cryptocurrencies’ popularity has surged during the last few years. This isespecially the case of bitcoin, one among cryptocurrencies which price has soaredfrom USD1,000 in the first quarter of 2017 to USD20,000 by the end of 2017. Ithas now being used by merchants as a medium of exchange. Upon realizing itspopularity, the CME Group that owns the Chicago Mercantile Exchange launcheda futures contract on bitcoin. Yet, there are cases where bitcoin is banned bythe country. This article examines the implication of bitcoin on Islamic financeand questions its acceptance as a medium of exchange (money) based on itscompliancy with shari’ah. By analyzing its nature and characteristics, the paperconcludes that, strictly speaking, cryptocurrencies that are not backed with realassets are not shari’ah-compliant. However, the majority of shari’ah scholarsare leaning towards approving bitcoin on maslahah basis. Bitcoin is neither fiatmoney nor real money. The absence of an intrinsic value coupled with lack orzero supervision by the central bank will result in misusing bitcoin. Furthermore,we content that it has the elements of maysir and gharar. This can contributetowards socio-economic injustices, thereby jeopardizing the maqasid al-shari’ah.Hence, based on a thorough analysis, we conclude that fiat cryptocurrencies arenot shari’ah compliant. However, gold-backed cryptocurrencies are argued to bedesirable and consistent with the maqasid al shari’ah.