Cryptocurrency and Islamic Finance
A cryptocurrency is a digital asset designed to work as a medium of exchange that uses cryptography to secure financial transactions, control the creation of additional units and verify the transfer of assets. There is an ongoing debate about the legality and permissibility of cryptocurrency in Islamic finance. Cryptocurrencies have the potential to become the future currency and maybe even backed by the government in the long run, but in order to be accepted in the mainstream Islamic finance, it has to overcome negative sentiments surrounded by the excess volatility and use in fraudulent activity and well regulated by both banking law and Shariah law. This chapter will provide an insight into the issue of the usage and challenges of cryptocurrency from an Islamic finance perspective.
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