DECENTRALIZED TRUST: A SHARIAH-COMPLIANT FRAMEWORK FOR BLOCKCHAIN-BASED ZAKAT AND WAQF MANAGEMENT SYSTEMS
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Blockchain, Decentralized Trust, Shariah Compliance
Abstract
The management of zakat and waqf funds is fundamental to promoting socio-economic welfare in Muslim communities. However, issues of transparency, accountability, and trust persist within many centralized fund governance systems, leading to inefficiencies, misallocation, and reduced public confidence. Blockchain technology offers decentralized and tamper-resistant infrastructure that can increase transparency and traceability of charitable transactions. This study aims to develop a Shariah-compliant conceptual framework for blockchain-based zakat and waqf management systems by integrating Islamic governance principles with decentralized trust mechanisms. A qualitative research approach was adopted, employing document analysis of classical and contemporary Shariah jurisprudence and expert interviews with Islamic finance scholars, zakat practitioners, and blockchain specialists. The findings indicate that smart contracts can support automatic distribution aligned with zakat nisab eligibility criteria and waqf asset preservation, while cryptographic audit trails enhance trust and regulatory oversight. Decentralized ledger mechanisms further ensure that fund utilization is visible to stakeholders without compromising donor and beneficiary dignity. The study concludes that a Shariah-compliant blockchain model can strengthen governance integrity, improve operational efficiency, and expand financial inclusion in Islamic social finance. Successful implementation requires a hybrid governance structure combining Shariah supervisory expertise with technological auditability, as well as policy development to ensure ethical compliance. Future recommendations highlight the need for pilot testing within zakat institutions to evaluate system scalability and user acceptance.
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Copyright (c) 2026 Ahmed Al-Fahad, Ali Khan, Juan Martínez
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