Islamic charity crowdfunding platform GlobalSadaqah is now facilitating cryptocurrency donations as the Malaysian start-up works toward further adopting blockchain technology into its business model of Shariah social finance.
Partnering with two other Kuala Lumpur-headquartered fintech firms – SINEGY and LuxTag – GlobalSadaqah has expanded its payment universe by including bitcoin donations.
“Blockchain has a lot of potential to increase the effectiveness of social finance. This is just the first step for us to integrate blockchain into the Islamic fintech ecosystem we are building. Another interesting area is blockchain-based notarizing of Waqf (Islamic endowments) documents and wills, among other things,” Umar Munshi, the managing director of Ethis Global, the parent company of GlobalSadaqah, commented.
The firm estimated Zakat collection to be worth some US$500 billion a year, which opens a slew of opportunities for social development initiatives.
“The value of bitcoin around the world collectively stands at around US$160.4 billion. Bitcoin alone accounts for 0.4% of the world’s money. On a conservative assumption that just 5% of this is owned by Muslims, it would easily amount to over US$8 billion, most of which should be eligible for Zakat which will be a total of US$200 million! This alone has the power to change so many lives around the globe for the better,” the start-up noted.
Islamic financial institutions are increasingly using distributed ledger technology, including in mobilizing resources for charitable and development projects. The IsDB last month introduced a blockchain-powered platform to disburse financial resources to its member countries impacted by the COVID-19 pandemic.