Islamic DeFi: Back to Basics – V

In the first and second blogs dedicated to the subject of Islamic Decentralized Finance (DeFi) we attempted to trace the trajectory of what we know as mainstream Islamic finance. We discussed the entire range of adoptions and adaptations of classical contracts adding up to constitute the Islamic financial system. With the benefit of hindsight, we…

Islamic DeFi: Back to Basics – IV

Simplicity is not just a virtue. It is an imperative in Islamic finance. Let us keep the game simple and comprehensible. Let us play the game differently. Part I | Part II | Part III Now-a-days I receive at least one headline pertaining to the crypto world among many others, as I click on Google,…

Islamic DeFi: Back to Basics – III

In the current whirlpool of speculation at Digital Asset Exchanges, speculative cryptos will drive out non-speculative ones from circulation. Click here for Part 1 of this series | Click here for Part 2 of this series Paper money was introduced almost four Centuries after the birth of the first Islamic state in Madinah. I presume…

Islamic DeFi: Back to Basics – II

DeFi, we should. Disrupt, we must. (Click here for Part 1 of this series) The positive contribution of Islamic microfinance to Islamic finance in general was the dichotomy it presented. There were the Grameen-type Islamic replications. There were also the indigenously born Baitul Maals and Qard Funds. Islamic microfinance was also practiced by Islamic non-profit…

Islamic DeFi: Back to Basics – I

The trajectory of the mainstream Islamic financial services sector, as we understand, has never been smooth. The maiden experiments in Islamic banking and finance perhaps started with the birth of institutions like the Dubai Islamic Bank and the Islamic Development Bank in the mid-1970s. A new breed of scholars, known as Islamic economists, dominated all…

Artificial Intelligence (AI) through the Lens of Islamic Economics – V

We can take comfort with the forecast that AI will firmly stay within human control and conveniently, trash the forecast of some that machines will become incomprehensibly smarter than humans with artificial super intelligence (ASI). However, in the event ASI materializes, it will be beyond our control. We can only hope that, before the inevitable…

Artificial Intelligence (AI) through the Lens of Islamic Economics – IV

Text analysis may be useful, for instance, for a waqf organization to know what the neighborhood feels about the public goods (education, healthcare, orphan care etc.) it provides. An association of zakat organizations in a country concerned about a high rate of “donor attrition” may feel the need for a “feel-good analysis” of donors. A…

Artificial Intelligence (AI) through the Lens of Islamic Economics – III

When a poor and needy individual (faqir/ miskeen) is wrongly classified as non-poor and deprived of zakat (a case of false-negative) or a rich is wrongly classified as poor and receives zakat (a case of false-positive), it involves ethical dilemmas of varying order. Of course, there are in-built mechanisms within the classification models to address…

Artificial Intelligence (AI) through the Lens of Islamic Economics – I

Intelligence, intellect, rationality may be subsumed under the notion of Aql in Islamic economics. However, when intelligence is artificial, it raises new issues and challenges. This is the first in a series of blogs that touches upon this issue and sets the stage for further discussion on application of AI in Islamic finance. Let me…

Blockchains through the Lens of Islamic Economics

Verifiability, traceability, immutability, validation through consensus, sharing through network, inter-generational distribution - attributes and concepts common to block chain methodology have a root in Islamic scholarship. The “chain” played a significant role in shaping the contours of Islamic economics, by creating the authenticated and tamper-proof records of the words of God and the words and…