Islamic finance DeFi platform built in Australia is premised on Sharia

Islamic finance DeFi platform built in Australia is premised on Sharia

The world’s first “Shariah-guided” decentralized finance platform to navigate a course between the advantages of DeFi and the beliefs of Islamic finance, is being built by a team based out of Sydney.

Seeking to offer the Islamic world a DeFi platform informed by the core tenets of Sharia, the Marhaba Decentralized Financial Platform (marhaba means “welcome” in Arabic) is expected to launch in the coming months.

A core tenet of Shariah-based finance is ensuring that “both the financial body providing a service and the client must win in the financial transaction.” According to Naquib Mohammed, chief innovation officer of Blockchain Australia and Marhaba’s CEO and founder, to Cointelegraph.

Naquib stated further that the platform is focused on the community inclusiveness   and where Muslims can be onboarded without any hesitation of doubt and which is premised on faith consciousness.

Mohammed turned his attention to designing a platform that caters to the world’s Muslim population of 2 billion, after founding enterprise-focused platform Spherium Finance in early 2020

Mohammed noted that the Marhaba team has done research into the attitudes of many Arabic communities regarding crypto assets. He recounted:

“In the Muslim countries, we found that 99% of the time, people ask: ‘Is this token Halal? Is this token Shariah compliant?’ […] Question number two is: ‘Where do you buy this?’

While most new crypto projects begin by tinkering on a testnet and seeking out talented meme lords on social media, Marhaba’s journey began with Mohammed seeking out respected Islamic scholars who also understand the crypto-asset sector and believe decentralized finance can be conducted in a way that adheres to Shariah thought.

The Islamic concept of riba (usury) prohibits “high-interest loans or aggressive derivatives” products, and transactions akin to gambling (maysir) and those that pose excessive risk or doubt (gharar) are also banned. Mohammed noted:

“The reason that Bitcoin is still under discussion by some scholars in the Islamic ecosystem is because nobody knows who the creator of Bitcoin is. If you don’t know who created it — that means the thing is under doubt.”

 

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