KUALA LUMPUR – The Malaysian government has inked a Memorandum of Understanding with the South Korean firm IncuBlock to develop blockchain technology that satisfies Shariah criteria.
In an interview with Coin Geek on June 21, Dato Hassan Binhmad, the head of the advisory committee of the Malay Consultative Council (MPM) said: “We hope this cooperation will lead to the development of blockchain technology that will be led by Malaysia and be used throughout the Islamic World.”
According to IT World, the partnership will result in the exchange of blockchain information and technical expertise.
This partnership aims to create a blockchain platform and distributed applications (Dapp) that would stick to shari’ah.
The agreement comes through Malaysia’s MPM and its international partner, Global Cornerstone Group.
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Shari’ah prohibits some activities, such as investing in companies of alcoholic beverages or pork food products. It also prevents Muslims from engaging in businesses that depend on interest charged on loans or usury.
What Is Blochchain Tech?
Blockchain is a list of records or “blocks” with a cryptographic security . Each block typically contains a cryptographic hash of the previous block, a timestamp, and transaction data.
By design, a blockchain is resistant to modification of the data. It’s an open ledger that can record transactions between two parties in a verifiable and permanent way.
For use as a distributed ledger, a blockchain is typically managed by a peer-to-peer network. Thus, its alteration is a very hard task.
Better Future
Kwon Won-seon, the CEO of the South Korean firm, IncuBlock, said that “the company’s experience in blockchain technology is the main reason for the deal. The knowledge will help the company create a viable solution. I will make a great effort to utilize the know-how of the blockchain we have accumulated over the years to develop the Islamic blockchain platform practically.”
Read Also: How Does Islam View Bitcoin and Other Cryptocurrencies?
Last May, TE-FOOD, a company that provides blockchain-based food tracking, launched a similar project with UK-based Halal Trail that tracks livestock and fresh produce from the farm to the end consumer through a halal, or permissible, food chain.
Certain mechanisms are already in place to ensure Shari’ah compliance in food preparation.
However, the use of the blockchain for tracking makes the practice more comprehensive; it gives Muslims a stronger guarantee that the food preparation is in accordance with Shari’ah.