The Future of Zakat in Blockchain Era: Opportunities and Implementation Challenges

Abstract

The integration of blockchain technology into Zakat management presents an innovative approach to enhancing transparency, efficiency, and accountability within the system [1]. Zakat, a fundamental pillar of Islam, mandates the donation of a portion of wealth to assist the needy; however, traditional collection methods are often marred by inefficiencies and a lack of transparency. This research examines the potential of blockchain to streamline zakat processes through features like decentralization and smart contracts, thereby improving fund allocation, reducing fraud, and lowering operational costs. Despite its promising benefits, the adoption of blockchain in Zakat management faces significant technical, regulatory, and sociocultural challenges. A thorough analysis of these barriers is crucial for developing effective strategies to overcome them and successfully integrate blockchain systems. Ultimately, this study highlights the need for targeted research and collaborative efforts to support more transparent and impactful zakat distribution.