FROM RIBA PROHIBITION TO DISTRIBUTED LEDGERS: RECONFIGURING ISLAMIC FINANCIAL LAW IN BLOCKCHAIN ECONOMIES
Indonesia 
Bahrain 
South Africa 
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Blockchain, Distributed Ledger, Islamic Finance
Abstract
Classical Islamic finance emphasizes the prohibition of rib? (usury) and the minimization of gharar (excessive uncertainty) as fundamental principles for ethical financial transactions. Emerging blockchain technologies, including distributed ledgers and smart contracts, challenge conventional mechanisms of contract enforcement while offering new opportunities for transparency, automation, and efficiency. This study aims to examine how blockchain-based financial instruments can be reconciled with Shariah principles, particularly rib? prohibition, and to assess their practical implications for Islamic financial law. A qualitative-dominant exploratory research design is employed, integrating doctrinal legal analysis, comparative evaluation of traditional and blockchain-based contracts, and semi-structured expert interviews. Data are analyzed thematically and comparatively to identify compliance patterns, operational efficiencies, and potential jurisprudential challenges. Results indicate that blockchain smart contracts demonstrate higher levels of compliance with Shariah norms, improved transparency, greater automation efficiency, and reduced dispute frequency compared to conventional Islamic financial contracts. Case studies highlight practical feasibility while underscoring the need for hybrid oversight combining algorithmic execution and scholarly verification. The study concludes that blockchain technology provides a transformative mechanism for reconfiguring Islamic financial law, enhancing both ethical compliance and operational efficiency in modern decentralized finance.
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References
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