Malaysia’s position as a global Islamic finance leader faces a critical juncture as blockchain technology and smart contracts promise to revolutionize financial transactions. This article examines the legal and Shariah compliance framework for implementing blockchain-based smart contracts in Malaysian Islamic banking, integrating the latest 2024-2026 research and regulatory developments. The analysis reveals significant legal gaps in Malaysia’s existing framework, particularly regarding automated contract execution, electronic evidence admissibility, and Shariah governance of decentralized systems. While smart contracts offer substantial benefits for Islamic banking products including mudarabah, musharakah, tawarruq, and sukuk, their adoption requires urgent regulatory clarification, enhanced Shariah governance mechanisms, and practical implementation guidelines. This article provides targeted recommendations for Malaysian regulators, Islamic financial institutions, Shariah scholars, and technology providers to facilitatesecure, compliant, and effective integration of smart contract technology.
MOHD ARDI SHAH BIN ABD RAHMAN SHAH (Tue,) studied this question.
Synapse has enriched 5 closely related papers on similar clinical questions. Consider them for comparative context: