https://s.binance.com/M0YQoVTN # Sharia Earn## Binance Loans: Detailed Analysis of the Sharia Ruling in Light of Islamic Law
### Introduction: Binance and Digital Finance Markets
Binance is the largest cryptocurrency exchange in the world, with trading volumes reaching trillions of dollars, offering a variety of financial services including **spot trading, margin trading, futures contracts, and lending services**. In light of the growing Islamic finance market exceeding **4 trillion dollars** and expected to reach **12.45 billion dollars by 2028**, a fundamental question arises: Do Binance's loan services comply with Islamic law? .
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### Nature of Binance Loans: Types and Mechanisms
#### 1. **Margin Loans**
- **Description**: Allows users to borrow funds to purchase cryptocurrencies using leverage, amplifying their profits or losses.
- **Financial Structure**: These loans include **daily/monthly interest payments** on the borrowed amount, and this interest increases with the length of the borrowing period.
#### 2. **Peer-to-Peer Lending (P2P Lending)**
- **Description**: Allows users to lend their cryptocurrencies to other users through the platform.
- **Return**: The lender receives a **fixed return paid periodically**, depending on the duration and amount of the loan.
#### 3. **Derivatives Services (such as Futures Contracts)**
- **Description**: Allows trading on future currency prices using borrowed funds.
- **Risks**: Classified as **highly volatile and based on speculation** in market trends.
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### Sharia Principles for Analyzing Loans: Riba, Gharar, and Maysir
The Sharia ruling is based on three main axes in Islamic jurisprudence:
1. **Riba (Prohibited Interest)**:
- Any fixed return on cash loans is prohibited, as Allah says: *"And Allah has permitted trade and forbidden riba"* (Al-Baqarah: 275).
- Binance loans **set a predetermined interest** based on the loan amount and repayment duration, which places them within the domain of riba.
2. **Gharar (Ambiguity and Excessive Risk)**:
- It is required in Islamic financial contracts **to clarify terms and define risks**.
- Margin loans and futures contracts depend on **unregulated market fluctuations**, making them forbidden gharar.
3. **Maysir (Gambling)**:
- Any profit resulting from **blind speculation without economic basis** is prohibited.
- Trading with leverage is considered **gambling** because it bets on price movements that may not be subject to tangible analysis.
*Table summarizing the Sharia position on Binance services:*
| **Service** | **Sharia Ruling** | **Main Reasons** |
|---------------------|------------------|------------------------------------------|
| Margin Loans | Forbidden | Riba (Fixed Interest) + Gharar (High Risk) |
| P2P Lending | Forbidden | Riba (Fixed Return on Loan) |
| Futures Contracts | Forbidden | Gharar + Maysir (Speculation similar to gambling) |
| Spot Trading | Permissible under conditions | No riba or gharar if prohibited products are avoided |
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### Scholars' and Sharia Institutions' Opinions
#### Prohibition Opinions:
- **Sharia Board of the Islamic Fiqh Academy**:
Any loans that include predetermined interest are prohibited, and **trading with leverage** is considered within the realm of maysir (gambling).
- **Sheikh Ali Gomaa (Former Mufti of Egypt)**:
Warns against cryptocurrencies primarily due to **their intangible nature**, increasing gharar in loan products.
#### Restrictive Opinions:
- **Mufti Faraz Adam**:
Believes that **spot trading** is permissible, but rejects any service that includes **guaranteed fixed returns** such as loans.
- **AAOIFI Standards**:
The permissibility requires **no riba**, **transparency in risks**, and **tying returns to real assets**.
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### Sharia-Compliant Alternatives: "Sharia Earn" and Specialized Platforms
Binance recently launched the **"Sharia Earn"** service as a Sharia-compliant alternative, which is:
- **Certified by "Amani Advisors"** (one of the largest Sharia supervisory bodies).
- Uses **Wakala Contract** where assets are managed without guaranteeing fixed profit.
- Profits are distributed based on **actual profits from mining activities or fees**, not fixed interests.
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### Practical Recommendations for Muslims
To ensure Sharia compliance:
1. **Avoid all interest-bearing loan products** such as Margin Loans and P2P Lending.
2. **Using "Sharia Earn"** as an approved alternative for earning from cryptocurrencies.
3. **Convert questionable profits to Zakat** if involved in unclear transactions.
4. **Utilizing digital fatwa programs** such as "Planet Finance" to assess products.
> The Prophet (peace be upon him) said: *"Leave what makes you doubt for what does not make you doubt"* (Narrated by Al-Tirmidhi).
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### Conclusion: Between Prohibition and Licensing
In conclusion, **traditional Binance loans are prohibited by Sharia** due to their inclusion of riba and gharar, but new services like "Sharia Earn" represent a bold model for digital Islamic finance. This emerging sector requires **more Sharia supervision**, but opens the door to **inclusive financing for over 1.9 billion Muslims** worldwide. Investors must **check each product individually** and not generalize; not everything on Binance is forbidden, and not everything labeled "Islamic" is permissible! .
