Islamic Finance (Shariah law) : A $3.9 Trillion Opportunity

Yet crypto has barely touched it.

Here’s some research on what it means to attract new liquidity 🕌:

➢ What is Islamic Finance?

Islamic finance follows principles from Shariah law. The core values:

> No interest (riba)

> No excessive uncertainty (gharar)

> Risk-sharing and asset-backing

> Ethical, real-world outcomes

It’s not just “finance with rules” — it’s a growing system used by 1.9B Muslims globally.

➢ Why It’s Hard for DeFi

Most DeFi protocols today rely on:

> Interest-bearing instruments

> Derivatives with high uncertainty

> Speculation without asset linkage

That makes them incompatible with Shariah-compliant frameworks — at least on the surface.

➢ But Fixed Yield Changes That

Protocols that offer fixed yield, predictable outcomes, and no leverage-based interest could open doors to this market.

If designed correctly, they align closely with Islamic principles:

> Certainty in return

> Real economic activity

> No usury or hidden risks

➢ Emerging Shariah-Compliant DeFi Protocols

Some are pioneering this space:

> @SolvProtocol launched SolvBTC.CORE, a Shariah-compliant Bitcoin yield product, enabling BTC holders to earn yields while adhering to Islamic finance principles

> @pendle_fi is reportedly exploring on Shariah-compliant fixed yield products to unlock ethical DeFi use cases

These protocols are creating financial products that respect Islamic principles, making DeFi more accessible to Muslim investors.

Excited to see new liquidity coming into DeFi.