Islamic Finance Principles Assessment
Riba — Does MinoTari (Tari) involve interest?
MinoTari's protocol generates value through mining rewards and fee burns, not interest. No lending, borrowing, or yield-bearing mechanism is native to the base protocol or its Layer-2 design. For Muslim investors, the absence of riba at the protocol level is a genuine structural positive.
Assessment: Moderate Riba
Score: 69/100
Our methodology examines 10 criteria to evaluate how well MinoTari (Tari) avoids interest-based mechanisms.
Tari's "revenue," insofar as the term applies to a decentralized protocol, consists of block rewards on a decaying emission schedule (transitioning to a perpetual ~1% tail emission after roughly 27.8 years) plus transaction fees, a portion of which are burned rather than distributed as interest-like payouts. No treasury is described as holding interest-bearing instruments, and no sources indicate the project earns income from conventional finance or lending operations. This emission-and-burn structure is closer to a commodity-style production model than to any interest-based financial arrangement, which is a favorable structural feature from a riba standpoint.
At the protocol level, Tari offers no lending or borrowing product; it is a proof-of-work L1 with a smart-contract-capable L2 ("Ootle") supporting DeFi, NFT, GameFi, and SocialFi applications built by third parties. Some centralized exchanges list "Earn" or "staking" products for XTM, but these are external services created unilaterally by exchanges, not features designed or endorsed by the Tari protocol itself. Since such third-party interest-bearing products are not part of Tari's own design, they should not be read as defining the coin's Shariah status, though Muslim holders should personally avoid enrolling in any exchange-side interest-bearing XTM product.
Gharar — How much uncertainty does MinoTari (Tari) involve?
Uncertainty in Tari is moderated by a named, credentialed team and open-source, publicly audited code, but heightened by thin trading volume, a still-maturing Layer-2, and undocumented deposit-bond mechanics for validators. On balance, informational gharar is manageable but market-thinness gharar is real. Investors should treat this as a higher-uncertainty, still-developing infrastructure project rather than a mature, low-uncertainty asset.
Assessment: Moderate Gharar (Material Uncertainty)
Score: 67.1/100
Our methodology examines 15 criteria including team transparency, audit quality, and governance.
Tari's founders are public and traceable: Riccardo Spagni (former Monero Core Team lead maintainer), Naveen Jain (Y Combinator alumnus, Sparkart/GloBee founder), and Dan Teree, all corroborated across LinkedIn, conference records, and third-party trackers. Development has been visible since 2017-2018 via public GitHub activity and RFC documentation, culminating in a May 2025 mainnet launch. No sources allege fraud or rug-pull behavior specific to Tari. This level of named accountability and multi-year public development history substantially reduces the gharar normally associated with anonymous or opaque crypto teams.
Two named third-party audits exist: Coinspect reviewed roughly 40-60% of the critical base-layer codebase, completed November 2023, and Quarkslab separately audited the Bulletproofs+ cryptography library between August and October 2023, both with public findings. This is genuine, disclosed audit coverage rather than an absence of review, though the partial base-layer coverage and lack of a full independent audit of the newer Layer-2 "Ootle" network leave some undocumented risk. Validator deposit-bond terms, reward mechanics, and slashing conditions for L2 are not clearly specified in available sources, which is a residual disclosure gap worth flagging.
Maysir — Does MinoTari (Tari) involve gambling or speculation?
Tari is not designed as a gambling instrument; it functions as infrastructure combining a mined base layer with a smart-contract-capable Layer-2 for real applications. Speculative trading occurs on secondary markets, as with virtually any listed token, but this behavior is external to the protocol's own design. The core project itself is productive rather than wager-based.
Assessment: Minor Maysir (Incidental)
Score: 70/100
Our methodology examines 11 criteria to determine whether MinoTari (Tari) is a gambling instrument or a genuine economic tool.
Tari's genuine utility rests in its merge-mined proof-of-work security model (paired with Monero via RandomX and a native SHA3x algorithm) and its Layer-2 "Ootle" network, which supports smart-contract templates for DeFi, NFTs, GameFi, and SocialFi use cases through validator nodes. XTM itself serves concrete functions: it is the mining-reward asset, the gas token for L1 transactions, and the burn-asset that mints the L2 token XTR. This multi-purpose, application-enabling design reflects productive network utility rather than a zero-sum betting mechanism, distinguishing it clearly from maysir-style instruments.
Against this genuine utility must be weighed a modest market: reported market capitalization near $12 million with thin daily volumes ranging roughly $17,000 to $151,000, indicating a small, still-developing market prone to volatility and potentially speculative price swings disproportionate to underlying usage. The 30% pre-mine with multi-year vesting also creates a supply overhang that could invite speculative positioning around unlock events. These are legitimate caution flags for volatility-driven speculation in secondary markets, but they arise from market immaturity and distribution structure rather than from any gambling mechanism embedded in the protocol itself.
The Full 27-Point Screening
1. Legitimacy (4 criteria)
| Criterion | Score | Analysis |
|---|
| Team Transparency | 85/100 | Founders Spagni, Jain and Teree are named, credentialed (Monero Core Team, Y Combinator, prior ventures) and traceable across multiple independent sources. |
| Fraud & Scam Risk | 65/100 | No fraud, hack or rug-pull reports were found for Tari itself, and the team/audit history are positive signals, but this is inferred from an absence of negative findings rather than an explicit clean-risk statement. |
| Use Case Legitimacy | 80/100 | Sources describe a functioning dual-layer architecture (PoW L1 plus smart-contract L2) with app distribution and merge-mining utility, not mere hype. |
| Ethical Practices | 80/100 | The protocol's own design is a privacy-oriented payments/asset infrastructure, not built for any haram industry; potential misuse of privacy features by third parties does not determine its own ruling. |
Summary: Tari has a publicly named, credentialed founding team with a long Monero-ecosystem track record and no reported fraud or rug-pull indicators.
2. Project Operations (9 criteria)
| Criterion | Score | Analysis |
|---|
| Core Protocol Business | 82/100 | The base protocol is blockchain infrastructure (mining, smart contracts, app distribution), which is not a prohibited sector. |
| Transaction Fees | 78/100 | Transaction fees are largely burned (all L2 fees, part of L1 fees) rather than extracted as interest-like rent, per the documented "turbine" burn model. |
| Treasury Assets | 55/100 | Pre-mine allocations are disclosed by category in XTM tokens, but no information describes the treasury's actual underlying asset composition (e.g., cash or interest-bearing instruments). |
| Revenue Model | 60/100 | The revenue design (mining rewards plus fee burns) shows no explicit interest mechanism, though no formal statement of a "revenue model" was found in the sources. |
| Transparency | 85/100 | The codebase is fully open-source on GitHub with public RFCs and published third-party audit reports. |
| Governance | 45/100 | Development is coordinated through RFCs from core Tari contributors with no described token-holder voting/DAO mechanism, suggesting notable centralisation. |
| Launch Fairness | 55/100 | The launch combined 70% mining rewards with a 30% pre-mine to community/infrastructure/contributors/investors under multi-year vesting — disclosed, but not a purely fair launch. |
| Token Distribution | 75/100 | Allocation is clearly disclosed: 70% to miners and 30% split transparently across community, infrastructure, contributors and early participants with vesting schedules. |
| Speculation/Utility Ratio | 60/100 | Genuine utility exists (mining, app distribution, L2 contracts), but exchange materials also frame XTM in trading/arbitrage terms, indicating a mixed speculation/utility profile. |
Summary: The protocol is a dual-layer PoW blockchain with a burn-based fee model, disclosed pre-mine/vesting schedule, and open-source code, though governance appears centred on core contributors rather than token-holder voting.
3. Financial Health (4 criteria)
| Criterion | Score | Analysis |
|---|
| Protocol Revenue | 60/100 | Revenue appears to flow from mining rewards and fee burns rather than interest, though no explicit protocol revenue disclosure was found. |
| Financial Status | 40/100 | Reported market cap (~$12M) and thin daily volumes ($17K-$151K) point to a small, illiquid market, and no detailed financial statements were found. |
| Interest Assessment | 82/100 | No native lending or borrowing exists at the base-protocol level; the base layer is PoW mining plus a smart-contract layer, not a credit market. |
| Audit Quality | 78/100 | Coinspect audited the base layer (completed November 2023, ~40-60% of critical code) and Quarkslab audited the Bulletproofs+ library (Aug-Oct 2023), both with public reports. |
Summary: Revenue derives from mining rewards and fee burns rather than interest, the market remains small and thin, and named security audits (Coinspect, Quarkslab) exist with public findings.
4. Token Economics (5 criteria)
| Criterion | Score | Analysis |
|---|
| Token Purpose | 78/100 | XTM functions as a fee/gas token, mining reward and L2-bridging asset — a genuine utility token, not a meme. |
| Governance Rights | N/A | No token-holder governance-voting mechanism was described; development is RFC/core-team driven, and this absence of on-chain voting is a design choice, not itself a Shariah concern. |
| Rewards Distribution | 75/100 | Rewards follow a decaying PoW emission curve plus a 1% perpetual tail emission tied to ongoing network-security work, not a fixed guaranteed payment. |
| Speculation Controls | 40/100 | Beyond vesting on the pre-mined portion, no anti-speculation mechanisms were described for the freely traded token supply. |
| Asset Backing | 60/100 | The token is backed by its network-security and app-distribution utility rather than by any disclosed pool of reserve assets. |
Summary: XTM is a utility token used for fees, mining rewards and bridging to the L2 token, with variable emission-based rewards but limited anti-speculation controls beyond vesting.
5. Staking Mechanism
MinoTari (Tari) 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: MinoTari presents as a credible, audited, utility-driven infrastructure project rather than a speculative meme coin, though centralised governance, a sizeable pre-mine, and limited disclosure on treasury composition and speculation controls leave some open questions.
Written by ThanvirFounder, Ex Director S&P Global Energy
Reviewed by Imam Omar SiddiqiShariah Scholar