Marhaba DeFi Network (MRHB), a Muslim-focused “ethical” decentralized finance platform, has introduced a “world first” certification for non-fungible tokens (NFTs) compliant with Sharia law.
Under the system, mined NFTs are submitted to a Sharia Governance Board, which reviews the artwork for humility and morality, in line with Halal, an Arabic concept that describes what is permissible under Islamic law.
Speaking to BeInCrypto, MRHB Founder and CEO Naqib Mohamed said that NFTs, whether in the form of image, video or audio, will be checked against issues such as nudity, hate speech, racism and authenticity.
Once completed, a certificate is issued on the blockchain and mined by London-based Sharia Experts Ltd., a halal advisory firm specializing in Web3 projects. He added that the “first” institution to receive such certification is Cash Gold, a Singapore-based gold crypto platform.
“The unreliable nature of NFT-based halal compliance certificates fulfills a pressing need in the halal economy sector, where certificate counterfeiting is common or difficult to validate, especially in the halal food industry,” Mohamed said.
“NFTs are unique and neither replaceable nor exchangeable – this makes them an ideal technology for immutable certificates,” he said. Halal non-fungible tokens are hosted on MRHB’s marketplace SouqNFT.
$2.7 trillion worth of Islamic finance sector is obsessed with bitcoin
Sharia compliance is an important customer requirement and regulatory requirement in many Muslim markets. But the legality of crypto assets like bitcoin (BTC) remains a matter of great controversy.
Prominent Islamic leaders have labeled bitcoin as “haram” – meaning that it is banned under Sharia law, as the asset can be used for illegal activities such as money laundering, gambling and fraud, according to the Quran. prohibited by.
There is also some concern about the lack of central authority and how digital currencies strip governments and central banks of their power over national monetary systems. In November, Asarun Niyam Sholay, a prominent Islamic scholar in Indonesia, issued a religious proclamation, or fatwa, warning followers against crypto investing, saying “it’s like a gambling bet.”
Against this backdrop, Naqib Mohamed’s MRHB DeFi network is foraying into the NFT space, hoping to woo the conservative Muslim loyalist with its halal-compliant non-fungible tokens. According to UK Muslim financial platform Kardas, the network is aiming to tap the Islamic finance sector worth more than $2.7 trillion and serve a billion people. Explaining, Mohammed said:
“MRHB is effectively acting as a gateway for the flow of Islamic liquidity into the crypto market. When Islamic liquidity flows in, so will the interest in NFTs. We are creating a new market.”
He said the certifications can help companies bring transparency and audibility to their work, allowing them to “show definite proof to their customers that their business practices are halal and acceptable to Muslims.”
Does Sharia Compliance Threaten DeFi’s Autonomy?
While the MRHB considers itself to be decentralized, its Sharia Compliance Enforcement Governance Board may be on par with gatekeeping. This is a curse to the ethos of DeFi, which thrives on autonomy, challenging the status quo. But Mohammed said:
“We certainly control certain aspects such as listing and operations within a set of protocols, but once audited by the Sharia team, the decentralized aspects are not compromised.”
He explained that in addition to religious considerations, the basics of halal-compliant NFTs are also acceptable to those who do not follow Islam because the standard expectations generally coincide with ethical web practices.
The MRHB says it is building an ecosystem of DeFi products and services “specifically designed for morally conscious people such as Muslims.” In 2021, the organization raised $5.5 million in an initial Dex offering (IDO). Since then, it has launched a crypto halal wallet called Sahal and has partnered with 14 companies including Polygon.
What did you think of this topic? Write to us and let us know!
