Quick Answer

Is Hermez Network halal?

Name: Hermez Network (HEZ) Shariah Compliance Screening
Item: Hermez Network
Rating: 65.6
Author: Crypto Ummah

Hermez Network is classified as doubtful (mashbooh), with a Shariah compliance score of 65.6/100 under our 27-point screening methodology.

Overall65.6Mashbooh · Doubtful · Risky

Riba72.4Halal

Gharar59.8Mashbooh

Maysir63.3Mashbooh

Full report Methodology

Shariah screening · tap a sub-dial

Project diligence tap a tile →

Minor Riba Moderate Gharar (Material Uncertainty)Moderate Maysir (High Risk)

GhararSharia pillar · 59.8/100 · Review · 15 criteria

Mashbooh. Prohibition of contracts with excessive ambiguity or hidden risk.

Team Transparency & Credibility75

Ethical Practices85

Transparency90

Governance30

Launch Fairness40

Token Distribution45

Speculation / Utility Ratio65

Financial Status40

Audit Quality80

Governance Rights40

Rewards Distribution78

Asset Backing50

Mechanism Type100

Documentation100

Shariah Alignment100

How HEZ compares

★ Hermez Network (HEZ)

65.6

Compare directly: vs Taiko · vs Immutable · vs Polygon

Purify your profits from HEZ

A portion of profit from HEZ isn't fully yours to keep — here's how to return it

What does "purification" mean?

Even fully screened assets can pick up small amounts of tainted income along the way — purification means giving that specific portion back, not paying extra.

Based on Hermez Network's riba, gharar and maysir screening — see how we calculate purification amounts.

Overseen by Imam Omar Siddiqi, Shariah scholar and Imam of JMIC, among others, with donations paid directly to Jamiya Masjid & Islamic Centre — UK registered charity no. 1089986. Sent wallet-to-wallet; CryptoUmmah never custodies your funds. Always verify the destination address before confirming in your wallet.

Mashbooh · Doubtful · Risky

Your exact purification amount, calculated from Hermez Network's Shariah compliance score.

Your realized profit on HEZ (USD) — profit only, not principal

Amount to return0.00 USDC

to Jamiya Masjid & Islamic Centre, a registered UK charity

Purification isn't Zakat and isn't tax-deductible — it's the return of income that wasn't rightfully yours.

Scholar-verified · UK registered charity

Key facts

Chain	Ethereum
Last reviewed	17 Jul 2026

Written by ThanvirFounder, Ex Director S&P Global Energy

Reviewed by Imam Omar SiddiqiShariah Scholar

Islamic Finance Principles Assessment

Riba — Does Hermez Network involve interest?

Hermez Network's core protocol shows no interest-bearing mechanism: revenue comes from an auction and fee-capture system, not lending or fixed coupon payments. Rewards to coordinators and participants are variable and tied to actual network usage. For Muslim investors, the base protocol itself does not embed riba, though third-party dApps built atop it should be assessed separately.

Assessment: Minor Riba Score: 72.4/100

Our methodology examines 10 criteria to evaluate how well Hermez Network avoids interest-based mechanisms.

Hermez's protocol revenue comes from transaction fees collected by coordinators who win the right to produce batches through a bidding auction. The winning bid is split roughly 30% burned, 40% donated to Ethereum public goods via Gitcoin, and 30% redistributed as usage incentives — none of this constitutes interest income. No source describes the project holding an interest-bearing treasury of bonds, savings instruments, or fixed-yield financial products. The rollup itself is a payments-scaling layer, not a lending or credit protocol, so riba does not arise from its own design.

There is no conventional staking product with a locked deposit and a guaranteed yield. Instead, coordinators bid HEZ tokens for batch-production rights, and the winning bid is distributed via burn, donation, and redistribution — a variable, usage-dependent flow rather than a fixed return. Coordinators separately earn transaction fees only when they actually process batches, making income performance-based rather than predetermined. One low-quality source claims HEZ holders earn "interest" as PoS validators via "the Merge," but this conflates Hermez with Ethereum's unrelated consensus mechanism and is not corroborated by technical documentation, so it is disregarded.

Gharar — How much uncertainty does Hermez Network involve?

Hermez carries a moderate but manageable level of uncertainty. Strong team transparency and completed audits reduce ambiguity, while concentrated token allocation and the absence of on-chain governance introduce residual concerns. Overall, the protocol's mechanics and risks are well-documented enough for informed evaluation.

Assessment: Moderate Gharar (Material Uncertainty) Score: 59.8/100

Our methodology examines 15 criteria including team transparency, audit quality, and governance.

The founding team is named and independently traceable: Jordi Baylina (also known for Giveth, DAppNode, and the White Hat Group), Antoni Martin, and David Z. built Hermez from the earlier iden3 identity project. The roughly 26-person team's acquisition by Polygon for a reported $250 million provided external validation and public scrutiny. Protocol, node, and SDK code are open-source on GitHub, and technical documentation and conference presentations are publicly available. This level of named accountability and code transparency substantially reduces gharar relative to anonymous or undocumented projects.

Hermez underwent two named third-party audits: Solidified in October 2020 (three auditors working in parallel, no critical or major issues found) and Trail of Bits (four person-weeks, October 26-November 9, 2020, with identified issues subsequently addressed). This is a genuine, documented audit trail rather than an absence of review. However, governance terms are less transparent: no source describes on-chain holder voting rights, treasury composition is not disclosed, and control passed informally to Polygon after acquisition, leaving some structural uncertainty around decision-making authority.

Maysir — Does Hermez Network involve gambling or speculation?

Hermez does not exhibit the characteristics of a gambling-oriented or purely speculative asset; its coordinator auction and fee mechanism serve a defined infrastructural purpose. Some secondary-market speculation is possible, as with any traded token, but this is incidental rather than designed-in. The protocol's own function is scaling and payments, not wagering.

Assessment: Moderate Maysir (High Risk) Score: 63.3/100

Our methodology examines 11 criteria to determine whether Hermez Network is a gambling instrument or a genuine economic tool.

Despite being tagged with meme-coin characteristics in some classification schemes, Hermez's own design centers on a functioning zk-rollup with published technical documentation, audited contracts, and a working mainnet — not a token created primarily for viral or speculative trading. Its HEZ token has a defined utility role in the coordinator bidding auction rather than existing purely as a vehicle for price wagering. Market capitalisation is modest, around $14.6 million with thin trading volume, which reflects limited attention post-Polygon-acquisition rather than active speculative mania.

Genuine utility exists: HEZ is required for coordinators to bid for batch-production rights, tying token demand to actual network throughput rather than narrative alone. Adoption is now largely folded into Polygon's broader zk-rollup roadmap following the 2021 merger, reducing independent trading activity. Thin liquidity and low market capitalisation mean that whatever secondary-market trading does occur carries elevated volatility risk, but this reflects general market thinness rather than a gambling-oriented design embedded in the protocol itself.

The Full 27-Point Screening

1. Legitimacy (4 criteria)

Criterion	Score	Analysis
Team Transparency	75/100	Founders (Baylina, Martin, David Z.) are named with traceable backgrounds and prior projects.
Fraud & Scam Risk	78/100	No fraud, hack, or rug-pull indicators are reported; the project was acquired by Polygon, a reputable acquirer.
Use Case Legitimacy	85/100	A functioning zk-rollup mainnet scales real Ethereum payments, indicating genuine utility beyond hype.
Ethical Practices	85/100	The protocol's own design is generic payment-scaling infrastructure with no targeting of a haram industry.

Summary: Hermez Network's founders are named and traceable, and the project was formally acquired by Polygon with no fraud or scam indicators reported in these sources.

2. Project Operations (9 criteria)

Criterion	Score	Analysis
Core Protocol Business	85/100	Core business is Ethereum scaling infrastructure, a neutral technical service.
Transaction Fees	70/100	Auction bid proceeds are burned, donated, and redistributed rather than extracted as interest.
Treasury Assets	50/100 (low evidence)	Sources give no description of any project treasury composition or its holdings.
Revenue Model	78/100	Revenue is fee-based from auction and coordinator activity, not interest-based lending.
Transparency	90/100	Protocol, node and SDK code are openly published on GitHub with accompanying documentation.
Governance	30/100	No on-chain holder governance is described; control sat with the founding entity and later Polygon.
Launch Fairness	40/100	Only 8.25% of supply circulated at launch while founders and team held 35% with multi-year vesting.
Token Distribution	45/100	Majority of supply went to incentives/partners but a third was reserved for founders and core team insiders.
Speculation/Utility Ratio	65/100	The token has a defined functional role in the auction mechanism rather than being a pure hype instrument.

Summary: Hermez operates an open-source zk-rollup that scales Ethereum payments through a fee-auction ("Proof-of-Donation") mechanism, though token launch and governance show meaningful centralisation among founders and the acquiring company.

3. Financial Health (4 criteria)

Criterion	Score	Analysis
Protocol Revenue	78/100	Revenue comes from transaction-fee capture in the auction, not from interest.
Financial Status	40/100	Market capitalisation is small (roughly $14.6M) with very thin trading volume, indicating limited current activity.
Interest Assessment	90/100	The base protocol is a payments/scaling rollup with no lending or borrowing function described.
Audit Quality	80/100	Named audits by Solidified and Trail of Bits in October–November 2020 with disclosed findings exist.

Summary: Revenue comes from coordinator transaction fees rather than interest, the protocol offers no native lending or borrowing, and named audits exist, but treasury composition and current market vitality are only thinly documented.

4. Token Economics (5 criteria)

Criterion	Score	Analysis
Token Purpose	75/100	The token has a genuine functional use within the coordinator bidding/auction system.
Governance Rights	40/100 (low evidence)	No governance rights for HEZ holders are described, and it cannot be confirmed whether any voting mechanism exists.
Rewards Distribution	78/100	Reward distribution from auction bids and fees varies with network usage rather than being fixed like interest.
Speculation Controls	55/100	Multi-year vesting on founder/team allocations provides a partial anti-dumping control, though no broader mechanism is described.
Asset Backing	50/100	Token value is tied to its functional role in the auction/fee system rather than to a collateral or reserve asset, though this is inferred.

Summary: HEZ is a functional utility token tied to the auction/bidding system with variable, usage-linked rewards and partial vesting-based anti-speculation controls, though it carries no confirmed holder-governance rights or asset backing.

5. Staking Mechanism

Hermez Network 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: Hermez Network presents as a legitimate, transparent Ethereum-scaling infrastructure project with documented audits and open-source code, whose main Shariah-relevant caveats are insider-heavy token allocation, centralised governance, and gaps in publicly available treasury and current-financial detail.

Is Hermez Network halal?

RibaSharia pillar · 72.4/100 · Compliant · 10 criteria

GhararSharia pillar · 59.8/100 · Review · 15 criteria

MaysirSharia pillar · 63.3/100 · Review · 11 criteria

LegitimacyDiligence dimension · 80.8/100 · Compliant · 4 criteria

ProjectDiligence dimension · 61.4/100 · Review · 9 criteria

FinancialDiligence dimension · 72/100 · Compliant · 4 criteria

TokenomicsDiligence dimension · 59.6/100 · Review · 5 criteria

StakingDiligence dimension · 100/100 · Compliant · 5 criteria