Publication:
Zakat payment from cryptocurrencies and crypto assets
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Date
2023
SDG:
Abstract
This paper aims to examine the existing practice of accepting zakat payments using cryptocurrencies and crypto assets by discussing its Shariah issues. This is qualitative research in nature, as unstructured interviews with experts in the field were conducted to understand the existing practice regarding zakat on cryptocurrencies/crypto assets while literature on the topic was reviewed to derive conclusions. It is found that there are divergent views among contemporary Shariah scholars on the Shariah permissibility of cryptocurrency and crypto assets. As such, by evaluating the existing practices of some companies, this study has concluded that there is room to pay zakat using cryptocurrencies and from investments made on crypto assets. As long as they have been screened and classified as Shariah-compliant, they can be qualified to be part of one's wealth from which zakat shall be paid. However, the findings of this research shall be subject to the fatwa and rules adopted in the specific jurisdiction in which the zakat payer resides. Laws made by the ruler to benefit the public ought to be considered in upholding the masalih (public interests) of all, which is in line with the legal maxim of "tasarruf al imam manut bi al-maslahah" (the ruler's decision is dictated in favor of the people). It is anticipated that the findings of this research will benefit zakat organizations and zakat payers in understanding how they should deal with cryptocurrencies and crypto assets in the collection and payment of zakat.
Keywords
Shariah , Islamic economics , Zakat , Blockchain , Cryptocurrencies , Crypto assets
Citation
Muneeza, A., Bin-Nashwan, S. A., A. Mohsin, M. I., Al-Saadi, A. (2023). Zakat payment from cryptocurrencies and crypto assets. International Journal of Islamic and Middle Eastern Finance and Management, 16(3), 482-497. http://dx.doi.org/10.1108/IMEFM-12-2021-0487
Publisher
Emerald Publishing Limited