Reimagining Global Financial Settlements: A Gold-Backed Cryptocurrency Framework Anchored in Blockchain and Islamic Finance Principles
DOI:
https://doi.org/10.61166/fadilah.v3i2.81Keywords:
Gold-Backed Cryptocurrency, Blockchain, Islamic Finance, Net Settlement, Fiat System, Financial Stability, Malaysia, Central BanksAbstract
In a world where economic turbulence and financial inequities are increasingly driven by the shortcomings of fiat currency systems, this paper advances a bold and timely proposition: the integration of gold-backed cryptocurrencies into global net settlement systems through blockchain technology. Bridging the philosophical depth of Islamic economic principles with the technical power of decentralized digital infrastructure, this study outlines a visionary framework that addresses the core weaknesses of inflation, centralization, and systemic risk. Grounded in qualitative research, including expert interviews and content analysis, the paper proposes a decentralized, ethically anchored, and technologically secure model that restores intrinsic value to money. Malaysia is identified as a strategic pioneer in this transformation, leveraging its leadership in Islamic finance and fintech to initiate a paradigm shift in global monetary governance. This work not only challenges existing financial orthodoxy but also provides a blueprint for a more stable, just, and transparent future of international finance
Downloads
References
Alvesson, M., & Deetz, S. (2000). Doing critical management research. SAGE Publications.
Arner, D. W., Buckley, R. P., Zetzsche, D. A., & Sergeev, A. (2022). Financial technology and the future of banking. Journal of International Economic Law, 25(2), 245–276.
Arner, D. W., Buckley, R. P., Zetzsche, D. A., & Sergeev, A. (2022). The role of money in the modern economy. Journal of Financial Regulation, 8(1), 1–33.
Bank for International Settlements (BIS). (2021). ISO 20022 and interoperability: Implications for central bank payment and settlement systems. https://www.bis.org
Bank for International Settlements (BIS). (2022). Triennial central bank survey of foreign exchange and OTC derivatives markets. https://www.bis.org/statistics/rpfx22.htm
Baur, D. G., & Lucey, B. M. (2010). Is gold a hedge or a safe haven? An analysis of stocks, bonds and gold. Financial Review, 45(2), 217–229.
Baur, D. G., & McDermott, T. K. (2010). Is gold a safe haven? International evidence. Journal of Banking & Finance, 34(8), 1886–1898.
Bernstein, P. L. (2000). The power of gold: The history of an obsession. John Wiley & Sons.
Bordo, M. D. (1998). The gold standard and price stability. In M. D. Bordo & A. J. Schwartz (Eds.), Retrospective on the classical gold standard, 1821–1931 (pp. 63–100). University of Chicago Press.
Chapra, M. U. (2000). The future of economics: An Islamic perspective. Islamic Foundation.
Corbet, S., Lucey, B. M., & Yarovaya, L. (2018). Cryptocurrencies as a financial asset: A review. Finance Research Letters, 26, 81–88.
Elasrag, H. (2021). Blockchain and Islamic finance: Opportunities and challenges. International Journal of Islamic Business and Management, 5(2), 15–27.
Ghazali, A. H. (2004). Ihya’ Ulum al-Din [Revival of the Religious Sciences] (Vol. 4). Dar al-Ma‘rifah.
Haneef, M. A., & Barakat, A. F. (2002). Contemporary Islamic economics: The missing dimension. Journal of King Abdulaziz University: Islamic Economics, 14(2), 25–45.
Harvey, D. (2005). A brief history of neoliberalism. Oxford University Press.
Held, D., & McGrew, A. G. (2007). Globalization theory: Approaches and controversies. Polity Press.
Hudson, M. (2012). The bubble and beyond: Fictitious capital, debt deflation and the global crisis. ISLET.
Ibn Taymiyyah, A. (1967). Al-Hisbah fi al-Islam [Market Regulation in Islam]. Cairo: Dar al-Kutub al-Hadithah.
Kydland, F. E., & Wynne, M. A. (2002). Alternative monetary standards and price stability. Federal Reserve Bank of Dallas Economic Review, Q4, 21–30.
Kydland, F. E., & Wynne, M. A. (2002). Monetary policy and the role of price stability. Review of Economic Dynamics, 5(4), 825–860.
Laldin, M. A. (2018). The objectives of Shariah (Maqasid al-Shariah) in Islamic finance. ISRA International Journal of Islamic Finance, 10(1), 1–9.
Lewis, N. (2007). Gold: The once and future money. Wiley.
Narayanan, A., Bonneau, J., Felten, E., Miller, A., & Goldfeder, S. (2016). Bitcoin and cryptocurrency technologies: A comprehensive introduction. Princeton University Press.
Reinhart, C. M., & Rogoff, K. S. (2009). This time is different: Eight centuries of financial folly. Princeton University Press.
Rey, H. (2013). Dilemma not trilemma: The global financial cycle and monetary policy independence. Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, 285–333.
Sholeh, M. A. N., Faiz, M. F., & Anwar, M. M. (2022). Gold and silver in Islamic monetary thought. Journal of Islamic Economics, Banking and Finance, 18(2), 99–115.
Sholeh, M. A. N., Faiz, M. F., & Anwar, M. M. (2022). The permissibility of cryptocurrencies under Islamic jurisprudence: A contemporary fiqh perspective. Journal of Islamic Monetary Economics and Finance, 8(1), 59–76.
Siddiqi, M. N. (2004). Riba, bank interest and the rationale of its prohibition. Islamic Research and Training Institute.
Skinner, C. (2016). ValueWeb: How fintech firms are using mobile and blockchain technologies to create the Internet of value. Marshall Cavendish International.
Smets, F. (2014). Financial stability and monetary policy: How closely interlinked? International Journal of Central Banking, 10(1), 263–300.
Stiglitz, J. E. (2016). The euro: How a common currency threatens the future of Europe. W. W. Norton & Company.
Subacchi, P. (2020). The cost of free money: How unfettered capital threatens our economic future. Yale University Press.
Tsai, W. T. (2018). Blockchain for financial applications. IEEE IT Professional, 20(1), 8–12.
Zetzsche, D. A., Buckley, R. P., Arner, D. W., & Barberis, J. N. (2020). Decentralized finance. Journal of Financial Regulation, 6(2), 172–203.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 Irma Naddiya Binti Mushaddik
This work is licensed under a Creative Commons Attribution 4.0 International License.
