The Legal Position of The Use of Cryptocurrency In Maqashid Sharia Review

Abstract

Cryptocurrencies, exemplified by Bitcoin and Ethereum, operate on blockchain technology, serving as digital currencies devoid of physical representation. The rapid expansion of cryptocurrencies has ignited debates on their adherence to Maqasid Sharia principles, governing life and finance in Islam. Maqasid Sharia revolves around safeguarding five fundamental principles, including wealth. Cryptocurrencies function anonymously, introducing uncertainties about privacy and transparency, thereby prompting inquiries into their social and economic impacts within the Maqasid Sharia framework. This research aims to deepen our comprehension of the legitimacy of Bitcoin transactions and the legal standing of cryptocurrency use from the perspective of Maqasid Sharia. The method used a descriptive qualitative methodology. The conceptual approach delves into legal science views and doctrines, forming the foundation for constructing legal arguments. A Maqasid Sharia review of cryptocurrency usage guides data collection through a literature review. The findings indicate that Bitcoin and other cryptocurrencies hold potential as alternative currencies due to their flexibility and simplicity. However, criticisms arise regarding Bitcoin's volatility, which renders it unsuitable for long-term financial risk management. Some perceive Bitcoin more as a speculative investment than a genuine currency. From Maqasid Sharia's standpoint, using cryptocurrencies like Bitcoin presents both benefits and drawbacks. Primary concerns involve legitimacy and control by authorities, juxtaposed with advantages such as decentralization and privacy.