Islamic Finance Principles Assessment
Riba — Does Candles involve interest?
Candles shows no evidence of interest-bearing mechanics in either its revenue model or its core function. Rewards flow from Bittensor emissions tied to prediction accuracy, not from lending spreads or fixed yield. On the specific point of riba, Candles appears clean, though the absence of disclosed treasury practices leaves a narrow residual uncertainty.
Assessment: Moderate Riba
Score: 55.6/100
Our methodology examines 10 criteria to evaluate how well Candles avoids interest-based mechanisms.
No explicit protocol revenue model beyond emission-based rewards tied to prediction-accuracy scoring is described in available sources. There is no disclosed treasury composition, no mention of interest-bearing reserves, and no indication that idle funds are placed into yield-bearing instruments. Since no market-cap, price-stability, or treasury-management data specific to Candles SN31 could be found, a definitive statement on treasury riba exposure cannot be made — but nothing in the sources points to interest income, and the reward structure itself is performance-linked rather than interest-based, which is a positive indicator.
The core business model of Candles SN31 is a prediction-and-scoring network within the Bittensor ecosystem: miners forecast candle price direction/values, validators score these forecasts against real market data, and emissions are distributed accordingly. This is structurally distinct from lending, borrowing, or money-market DeFi protocols referenced elsewhere in the research, none of which apply to Candles. No lending pools, interest-bearing partnerships, or debt instruments are described anywhere in the sourced material, making the core mechanism free of riba by design.
Gharar — How much uncertainty does Candles involve?
Gharar is the dominant concern for Candles, driven primarily by unverifiable team identity and the absence of a dedicated audit. The open-source codebase and public Terms of Use offer partial transparency, but they do not compensate for missing tokenomics, vesting, and governance detail. On balance, this uncertainty is significant enough to warrant caution.
Assessment: Excessive Gharar (High Uncertainty)
Score: 45/100
Our methodology examines 15 criteria including team transparency, audit quality, and governance.
No named, credentialed founders or team members specific to Candles SN31 were found; other "Candle"-branded entities located in searches (CandleX, Candle Finance, Kandle Finance) are unrelated companies and cannot be attributed to this project. The GitHub organisation "CandlesTAO" hosts a publicly viewable codebase, which is a genuine transparency positive, and a Terms of Use document outlines miner/validator roles. However, anonymous leadership combined with unverifiable track record leaves investors unable to assess accountability, a material gharar factor.
No security audit specific to Candles SN31 could be located in the sources; a Halborn audit appearing in search results belongs to an unrelated project ("Substance Exchange") and cannot be credited to Candles. Plainly stated: this protocol appears unaudited, which is a direct gharar concern that should be named as such. Additionally, tokenomics, vesting schedules, treasury composition, and transaction-fee handling are not substantively disclosed, and the degree of validator-level governance centralisation is unclear, compounding the uncertainty around how the system is actually controlled.
Maysir — Does Candles involve gambling or speculation?
Candles is not designed as a betting or wagering product; it is a performance-scored prediction network with rewards tied to forecasting accuracy against real market data. This distinguishes it from pure chance-based gambling, though secondary-market trading of the token could still exhibit speculative behaviour common to many crypto assets. The core protocol design itself does not constitute maysir.
Assessment: Moderate Maysir (High Risk)
Score: 51.4/100
Our methodology examines 11 criteria to determine whether Candles is a gambling instrument or a genuine economic tool.
Candles' genuine utility lies in its function as a decentralized forecasting and scoring subnet on Bittensor: miners perform a skill-based task (predicting candle price direction/values) and are compensated according to measurable accuracy, while validators are rewarded for scoring performance. This accuracy-linked, effort-based reward structure is a productive activity — closer to a competitive forecasting market than a game of chance — and this functional design is what separates Candles from a maysir-based instrument.
Weighed against this genuine utility, no anti-speculation controls (transfer limits, vesting locks, sale caps) are mentioned in the sources, and no market-cap or trading-behaviour data specific to Candles SN31 was found to gauge secondary-market speculation. As with most tradable tokens, third parties could speculate on the token's price independent of its underlying utility; per the stated judgment principle, such potential misuse by traders does not by itself render the protocol's own design impermissible, since the core mechanism remains a legitimate, skill-based prediction utility.
The Full 27-Point Screening
1. Legitimacy (4 criteria)
| Criterion | Score | Analysis |
|---|
| Team Transparency | 30/100 | No named or credentialed team specific to this project was found; other "Candle" branded profiles in the sources belong to unrelated companies. |
| Fraud & Scam Risk | 50/100 (low evidence) | No fraud, hack, or regulatory action tied specifically to this project was found in the sources, but no strong trust signals were found either. |
| Use Case Legitimacy | 70/100 | Sources describe a genuine functional use case: a decentralized prediction/scoring network for crypto price candles. |
| Ethical Practices | 60/100 | The protocol's own design is an analytics/prediction service rather than an inherently prohibited sector, though it operates within a price-prediction/trading context. |
Summary: The sources show a functional Bittensor-based prediction subnet under the "CandlesTAO" GitHub organisation with no fraud indicators found, but the founding team's identity and track record are not established in these sources.
2. Project Operations (9 criteria)
| Criterion | Score | Analysis |
|---|
| Core Protocol Business | 70/100 | The base protocol is a prediction-and-scoring subnet, not a lending, gambling, or otherwise prohibited business. |
| Transaction Fees | 40/100 (low evidence) | No information on fee burning, retention, or distribution was found in the sources. |
| Treasury Assets | 40/100 (low evidence) | No treasury composition information was found in the sources. |
| Revenue Model | 55/100 | Revenue/reward appears emission- and accuracy-based rather than interest-based, but no explicit revenue model is documented. |
| Transparency | 65/100 | A public GitHub repository and published Terms of Use demonstrate open-source code and disclosure of operating rules. |
| Governance | 45/100 | Validators can adjust scoring parameters via "governance or policy," but the overall governance structure and centralisation level are unclear. |
| Launch Fairness | 40/100 (low evidence) | No launch fairness, pre-mine, or initial distribution details were found in the sources. |
| Token Distribution | 40/100 (low evidence) | No token distribution or vesting details were retrievable despite a dedicated tokenomics page existing in the search results. |
| Speculation/Utility Ratio | 55/100 | The protocol's design centres on a utility function (prediction accuracy), suggesting utility orientation, but no market/speculation data is available to confirm the ratio. |
Summary: The base protocol is an open-source Bittensor subnet where miners predict crypto price candles and validators score them for emissions, but details on fees, treasury, launch fairness, and token distribution are not disclosed in the sources.
3. Financial Health (4 criteria)
| Criterion | Score | Analysis |
|---|
| Protocol Revenue | 55/100 | No interest-based revenue is described; rewards appear tied to network emissions and prediction performance rather than riba. |
| Financial Status | 40/100 (low evidence) | No market standing, valuation, or financial stability data specific to this coin was found. |
| Interest Assessment | 75/100 | The protocol is described purely as a prediction-and-scoring network with no lending or borrowing function at the base-protocol level. |
| Audit Quality | 15/100 | No audit specific to Candles (SN31) was found; an unrelated project's audit appears in the sources but cannot be attributed here. |
Summary: No protocol revenue figures, market-stability data, or security audit specific to this coin were found, and the base protocol itself involves no lending, borrowing, or interest-bearing yield.
4. Token Economics (5 criteria)
| Criterion | Score | Analysis |
|---|
| Token Purpose | 65/100 | The token underpins a genuine miner/validator reward function tied to real prediction performance, not a purposeless meme design. |
| Governance Rights | 40/100 | Beyond validator-level parameter adjustments, no clear description of formal token-holder governance rights was found. |
| Rewards Distribution | 65/100 | Rewards are explicitly variable, driven by prediction accuracy and validator scoring rather than fixed payouts. |
| Speculation Controls | 35/100 (low evidence) | No anti-speculation mechanisms (locks, caps, vesting controls) are described in the sources. |
| Asset Backing | 45/100 | Token value appears tied to network utility and emissions rather than any disclosed hard-asset backing. |
Summary: The token rewards genuine network participation (prediction accuracy and validator scoring) with variable, performance-linked payouts, though formal governance rights and anti-speculation controls are not clearly documented.
5. Staking Mechanism
Candles has no native staking mechanism, so these five criteria are not applicable and are excluded from the score entirely rather than counted as zeros.
Overall Assessment: Candles (SN31) appears to be a genuine utility-driven prediction network rather than a meme coin, but significant gaps in team transparency, audit history, fee/treasury disclosure, and staking information limit how fully its Shariah compliance can be verified from the available sources.
Written by ThanvirFounder, Ex Director S&P Global Energy
Reviewed by Imam Omar SiddiqiShariah Scholar