The Convenience of Blockchain Technology to Islamic Financial Transactions (Suggested Legal Vision)

Abstract

The main idea of ​​blockchain is about decentralized technology, which is independent of the control of any party that concludes or documents contracts. Because this technique was established to escape from the third party that concludes transactions between parties and documents contracts, as well as to escape from domination of law. Despite this, ​​blockchain is seen as the best solution to many legal dilemmas that are difficult to solve according to the traditional legal rules, especially with regard to the registration and transmission of digital assets, because these assets have become a reality that has imposed itself on many vital sectors, especially banking and financing. The use of blockchain technology as a mediator in financial transactions has become an inevitable and indispensable matter, for this reason, some countries have started to amend their laws to fit this new technology like France, which issued a decree called Blockchain decree, several US states also passed laws regulating the provisions of this technology, the first US state to legislate blockchain was Vermont. However, these legislations and amendments are not sufficient to accommodate all legal aspects of Blockchain technology, due to its novelty and continuous development, moreover, many countries have not followed the example of countries that have amended their legislation. Therefore, there is a large legislative vacuum regulating this technology in most countries of the world. This research explains the legal concept of blockchain technology, how it works, and the rules of law that organized it. It clarifies the appropriate legal mechanism to apply Islamic financial transactions to blockchain by applying the smart sukuk, the research also proposed some legal rules governing them.