Islamic Finance Principles Assessment
Riba — Does ZEAL involve interest?
ZEAL's core function is a decentralized exchange charging swap fees, not a lending or interest-bearing product. No evidence in available sources points to fixed, guaranteed interest income anywhere in the protocol's design. On balance, ZEAL does not appear structurally riba-based, though reward mechanics remain incompletely disclosed.
Assessment: Moderate Riba
Score: 54/100
Our methodology examines 10 criteria to evaluate how well ZEAL avoids interest-based mechanisms.
ZealousSwap's revenue derives from trading/swap fees generated on its AMM pools, per DefiLlama's fee-to-revenue tracking — a model consistent with commercial exchange activity rather than interest-bearing lending. Reported figures are modest: $2,688 in annualized revenue and just $817 cumulative, alongside a $600K "insurance fund" of undisclosed composition. Nothing in the available documentation indicates the treasury holds interest-bearing instruments, bonds, or conventional bank deposits. The revenue base is thin and largely fee-driven, which is structurally permissible in form, though the smallness of the numbers itself raises questions about the protocol's genuine economic activity versus token-driven speculation.
The Infinity Pool staking mechanism converts ZEAL into xZEAL and is described as paying a "revenue share," quoted at 35% APR in a third-party demo, alongside separate farming APRs exceeding 138%. These figures float with trading volume and emissions rather than being contractually fixed, which points toward a profit/loss-sharing structure rather than classic riba. However, the precise split between fee-derived rewards and token emissions is undocumented, and no formal disclosure clarifies whether any portion functions as a guaranteed payout. This ambiguity is a gharar concern more than a riba one, but it should be resolved before treating the yield as unambiguously permissible profit-share.
Gharar — How much uncertainty does ZEAL involve?
Uncertainty here is substantial: the project's team is anonymous, audit status is unconfirmed, and staking mechanics are thinly documented. What reduces some uncertainty is that ZealousSwap is a functioning DEX with visible on-chain activity rather than a purely conceptual token. Overall, the level of undisclosed detail warrants caution and active avoidance until better documentation surfaces.
Assessment: Excessive Gharar (High Uncertainty)
Score: 39.7/100
Our methodology examines 15 criteria including team transparency, audit quality, and governance.
No founders, developers, or accountable individuals are named for ZealousSwap or ZEAL in available research, making this an anonymous-team project. Search results are further complicated by name collisions with unrelated companies (a wallet app, a payroll firm, a lottery operator), which obscures independent verification of ZealousSwap's own claims. A gitbook and a third-party demo video are the only substantive documentation sources found — no formal whitepaper, open-source repository confirmation, or governance charter beyond a passing DAO-voting reference tied to xZEAL. This lack of named accountability is a material transparency gap.
No named, dated security audit — from Halborn, Certora, Trail of Bits, or any comparable firm — could be confirmed as covering ZealousSwap or ZEAL's smart contracts; a Halborn audit surfacing in searches belongs to an unrelated project entirely. This is an unaudited protocol by the available evidence, which is a direct and namable gharar concern for any DeFi contract handling user deposits, staking, and farming. Terms of service, staking lock-up conditions, slashing risk, and precise reward-source breakdowns are similarly undisclosed beyond a brief gitbook page and one demo video, leaving investors with limited formal risk disclosure.
Maysir — Does ZEAL involve gambling or speculation?
ZEAL is tagged as carrying meme-coin characteristics alongside its DeFi functionality, and it does exhibit real AMM/staking mechanics rather than existing purely as a speculative token. What tempers a maysir concern is the presence of genuine swap and farming utility; what heightens it is very low real usage relative to advertised high yields. The overall picture leans toward caution given the gap between marketed returns and actual protocol revenue.
Assessment: Maysir / Qimar (Gambling)
Score: 48.6/100
Our methodology examines 11 criteria to determine whether ZEAL is a gambling instrument or a genuine economic tool.
Where a token's design leans meme-like, with limited productive economic function, its value tends to derive primarily from speculative trading rather than genuine service provision — resembling maysir. For ZEAL, on-chain revenue figures ($2,688 annualized, $297 over 30 days) are strikingly small relative to a reported ~$3M TVL and advertised triple-digit farming APRs. This gap between marketed yield and actual fee generation suggests token price action and speculative positioning, rather than swap-fee economics, may be the dominant driver of activity — a pattern that resembles gambling-like dynamics even where the underlying product is a legitimate DEX.
Against this, ZealousSwap does offer a functioning AMM with real swaps, liquidity pools, and a capped emissions schedule (4.6% inflation over 8-9 years), which is a genuine, non-speculative infrastructure use case distinct from a pure meme token with no protocol. Third-party misuse of any liquid, tradable asset for short-term speculation is a market behavior, not a design flaw, and should not by itself condemn the token. That said, the combination of thin verified usage, unaudited contracts, and anonymous leadership means the speculative risk here is compounded by disclosure gaps rather than offset by demonstrated adoption, favoring a cautious, avoidance-leaning stance until transparency improves.
The Full 27-Point Screening
1. Legitimacy (4 criteria)
| Criterion | Score | Analysis |
|---|
| Team Transparency | 25/100 | No founders or credentialed individuals are identified anywhere in the sources for the actual ZealousSwap/ZEAL project, only for unrelated same-named companies, suggesting an untraceable team but this is inferred from absence rather than a direct statement. |
| Fraud & Scam Risk | 50/100 (low evidence) | No fraud, hack, or rug-pull indicator tied specifically to ZealousSwap/ZEAL appears in the sources, but the sources also provide no positive trust signals (audits, track record) to confirm safety either way. |
| Use Case Legitimacy | 60/100 | The sources confirm a functioning AMM DEX with TVL, swaps, and farming activity, indicating genuine (if small-scale) utility rather than pure hype. |
| Ethical Practices | 75/100 | The protocol's own design is a decentralized exchange/AMM, a sector with no inherent prohibition, though this is inferred rather than explicitly stated as Shariah-neutral. |
Summary: The sources largely describe unrelated same-named companies, leaving the actual ZealousSwap/ZEAL team and track record undocumented and untraceable.
2. Project Operations (9 criteria)
| Criterion | Score | Analysis |
|---|
| Core Protocol Business | 80/100 | Sources explicitly describe the base protocol as an AMM-based DEX, a category not in a prohibited sector. |
| Transaction Fees | 55/100 | Fees are user-paid swap fees with a portion routed to treasury/token holders, which is not inherently interest-like, but the exact fee-handling split (burn vs. distribution) is not fully detailed. |
| Treasury Assets | 40/100 (low evidence) | The sources give no information on the composition of the project treasury (e.g., whether it holds interest-bearing instruments), so this could not be established. |
| Revenue Model | 75/100 | Revenue is explicitly described as coming from swap/trading fees rather than interest-based lending activity. |
| Transparency | 45/100 | A gitbook and DefiLlama listing exist, but no confirmation of open-source smart contract code specific to ZealousSwap was found. |
| Governance | 45/100 | A DAO-voting utility tied to xZEAL is mentioned, but the actual governance structure, voting thresholds, and decentralization are not detailed. |
| Launch Fairness | 55/100 | Documented vesting (2-year cliff, gradual 2-year unlock for team) and phased airdrops suggest a moderately structured, non-instant launch. |
| Token Distribution | 55/100 | Token allocation across team, creators, community fund, and long-duration farms is explicitly documented. |
| Speculation/Utility Ratio | 30/100 | Very high quoted farming and staking APRs relative to minimal recorded protocol revenue suggest the token's current usage leans speculative rather than utility-dominant. |
Summary: ZEAL underpins a small Kaspa-ecosystem AMM DEX with documented but not fully transparent fee handling, treasury, and governance structures, alongside a multi-year vested token distribution.
3. Financial Health (4 criteria)
| Criterion | Score | Analysis |
|---|
| Protocol Revenue | 75/100 | Protocol revenue is fee-based from DEX trading, not derived from interest/riba mechanisms. |
| Financial Status | 30/100 | Reported financials show very small annualized revenue (a few thousand dollars) and modest TVL, indicating limited scale and stability. |
| Interest Assessment | 75/100 | The base protocol is a DEX with farming/staking, not a lending or borrowing market, so no interest-based lending exists at the protocol level per the sources. |
| Audit Quality | 10/100 (low evidence) | No named audit firm or dated audit report covering ZealousSwap/ZEAL smart contracts appears anywhere in the sources; audit status could not be established. |
Summary: Protocol revenue is fee-based and non-interest in nature but very small in scale, and no security audit for this specific project could be found in the sources.
4. Token Economics (5 criteria)
| Criterion | Score | Analysis |
|---|
| Token Purpose | 50/100 | ZEAL is used for staking, farming rewards, and governance voting, suggesting some functional utility, though the depth of that utility is thinly documented. |
| Governance Rights | 50/100 | Staked xZEAL is said to carry "DAO Voting Utility," but voting mechanics, proposal scope, and participation details are not explained. |
| Rewards Distribution | 55/100 | Rewards (farming, LP fees, staking APR) appear tied to protocol activity/emissions rather than a stated fixed rate, but the precise calculation method is unclear. |
| Speculation Controls | 20/100 (low evidence) | No anti-speculation mechanisms (caps, cooldowns, position limits) are mentioned anywhere in the sources despite very high advertised yields. |
| Asset Backing | 30/100 | No stated asset backing exists; the token's value appears to rest on trading activity and speculative demand rather than collateral or real assets. |
Summary: ZEAL carries some functional utility (staking, farming, governance) but current incentive structures and high advertised yields suggest a speculation-leaning profile with no anti-speculation controls or asset backing described.
5. Staking Mechanism (5 criteria)
| Criterion | Score | Analysis |
|---|
| Mechanism Type | 40/100 | The Infinity Pool staking mechanism is described only briefly, with no clarity on custody model, lock-up duration, or withdrawal terms. |
| Islamic Contract Classification | 30/100 | The "revenue share" framing for xZEAL could resemble a profit-sharing arrangement, but insufficient detail leaves its Islamic contract classification unresolved. |
| Rewards Structure | 25/100 | The quoted 35% APR is presented as a fixed-looking headline rate despite being labeled a revenue share, leaving ambiguous whether rewards are genuinely variable or effectively guaranteed. |
| Documentation | 20/100 | Only a brief gitbook page and a third-party demo video document the staking mechanism, with no formal terms-of-service or risk disclosure found. |
| Shariah Alignment | 30/100 | The unresolved question of whether staking rewards are truly variable or fixed-like, combined with thin documentation, leaves a live Shariah classification question unaddressed by the sources. |
Summary: A native "Infinity Pool" staking mechanism exists, converting ZEAL to xZEAL with governance rights and a revenue-share reward, but custody model, lock-ups, and documentation remain largely unverified.
Overall Assessment: ZEAL appears to be a functioning but small-scale DEX utility token with several unresolved transparency, audit, and staking-classification gaps that limit confidence in a definitive Shariah assessment based on these sources alone.
Written by ThanvirFounder, Ex Director S&P Global Energy
Reviewed by Imam Omar SiddiqiShariah Scholar