Mechanism of Functional Cryptocurrency Trading from an Islamic Perspective

Abstract

This paper aims to study the mechanism of buying and selling cryptocurrency on the Digital Asset Exchange (DAX) platform from an Islamic perspective by discussing its Shariah issues. This study is a research paper in the form of qualitative research, sourced from secondary sources in the form of scientific books, journals, and books on jurisprudence related to cryptocurrency. This study also refers to the DAX platform from analyzing the Product Disclosure Sheet (PDS).It was found that contemporary Shariah scholars have different views regarding the Shariah reliability of cryptocurrencies. Therefore, this study focuses on contracts and types of cryptocurrency trading on the DAX platform in Malaysia and concludes that there is a fiqh takyif related to the form of cryptocurrency trading. However, the findings of this study must be subject to fatwas and regulations adopted within the specific jurisdiction of the sale and purchase business. The views of religious councils and contemporary Sharia scholars are considered in categorizing cryptocurrency sales contracts so that fath dhara'i can be applied to crypto currencies that are increasingly used. This research contributes significantly to the literature on Shariah-compliant cryptocurrency trading. By recognizing the permissibility of cryptocurrency within the framework of muamalah (Islamic commercial law), organizations can effectively apply principles to cryptocurrency transactions. This adaptation ensures transparent and compliant practices in the evolving digital financial landscape.