Problem Statement & Solution

Problem Statement & Solution

Problem Statement & Solution

Whilst Decentralised Finance (DeFi) has grown in adoption across both the Ethereum ($71bn in TVL) and Binance Smart Chain ($36bn in TVL) networks, currently there is no Shari'ah compliant DeFi protocol in existence. This is an opportunity for two key reasons:

1. Users looking to engage with decentralised finance apps (Dapps) cannot reliably ensure that the practical obligations of their faith are met (with respect to financial transactions in the onchain world).

2. DeFi presents a powerful way of creating better Islamic Finance products and services through the reduction in human error (centralised Islamic Finance relies heavily on many manual contractual checking/vetting processes) through the use of Shari'ah compliant smart contracts.

The solution

At Barakah Finance we are committed to building a Shari'ah compliant DeFi platform creating investment, earning and financing opportunities for the world's 2 billion Muslims. We will achieve this through an innovative use of Shari'ah compliant hybrid smart contracts, screened staking opportunities, as well as a great UX/UI, introducing the world of Shari'ah compliant financial services to a younger audience.

Hybrid smart contracts are smart contracts that facilitate on-chain transactions (investment/earning related transactions) based on off-chain data (i.e. commodity prices) via the use of decentralised oracle networks.

Barakah Finance will lead the way in the development of standards on Shari'ah compliance in the creation of staking smart contracts (and other digital asset related Islamic DeFi smart contracts) through collaboratively working with internationally respected Shari'ah Scholars and standard-setting bodies. Some of the expertise built up in this area will be packaged up as white-labelled solutions for existing Islamic Financial institutions as we believe Shari'ah compliant smart contracts will have a role to play in both centralised and decentralised Islamic Finance in the future.