Blockchain for Zakat: Integration of Maqasid as-Shari'ah and Socio-Economic Functions in Indonesia

Integration of Maqasid as-Shari'ah and Socio-Economic Functions in Indonesia

Abstract

Indonesia, the fourth most populous country in the world, has a vibrant religious, cultural and economic diversity. With 270 million people spread across more than 17,000 islands, Indonesia is one of the largest economies in Southeast Asia. Islam with one of its religious pillars, zakat, is an instrument that has enormous potential to improve social and economic welfare, however, the challenge of transparent and efficient zakat management is still a major issue in Indonesia. This article will propose the implementation of blockchain technology as a way out to improve transparency and accountability in zakat management, in line with the principles of Maqasid as-Shari'ah. The implementation of blockchain technology will ensure the targeted distribution and reduce the potential for misuse of funds as well as speed up the transaction process. This research will also examine how the social and economic impact of zakat through the integration of digital technology can strengthen social ties between muzakki and mustahik and encourage economic empowerment in poor communities. The results will show that by utilizing blockchain zakat will be more effective in achieving an Islamic socio-economic goal as well as advancing a more transparent and fair financial system. This research recommends the implementation of blockchain in zakat management to increase public trust and optimize zakat in Indonesia.