RECONTEXTUALIZING HADITH ON TRADE AND RIBA: ASSESSING TRANSACTIONAL ETHICS IN THE DIGITAL SHARIA

Abstract

The rapid integration of technology in financial activities has blurred the boundaries between legitimate trade and prohibited financial practices, posing novel ethical dilemmas in modern Islamic finance. Objective: This study aims to recontextualize prophetic traditions (Hadith) on trade and riba (usury) to formulate a robust ethical framework capable of navigating the complexities of the contemporary digital economy. Method: Utilizing a qualitative-textual method, this research integrates the frameworks of Maqasid al-Shari'ah (objectives of Islamic law), Fiqh Muamalat, and Asbab al-Wurud (historical context of Hadith) to deconstruct the underlying ‘illah (legal effective cause) of economic prohibitions. Results: The findings reveal that the prophetic prohibitions on riba and gharar (uncertainty) fundamentally transcend formalistic legalism, aiming instead at safeguarding wealth (hifz al-mal) and establishing systemic justice (‘adalah). From these ontological roots, this study derives universal ethical principles—principally transparency, risk-sharing, and non-exploitation. Conclusion/Implication: Applied as a normative benchmark, these principles demonstrate that while fintech lending and cryptocurrency offer financial inclusivity, they inherently harbor structural vulnerabilities toward hidden usury and speculative bubbles. This study provides a foundational matrix for regulators and scholars to evaluate and align modern financial innovations with authentic Islamic ethical axioms