Is AllianceBlock Halal: Is ALBT Halal?

What is AllianceBlock: ALBT coin?

AllianceBlock is a layer 2 blockchain-agnostic system that can link traditional finance and decentralized finance and automate the process of converting any digital or crypto asset into a bankable product. It uses a proprietary AI algorithm to rate corporations and investors.

AllianceBlock, cofounded by the three European incubators Station F, L39, and Kickstart Innovation in Zurich, is financed by a network of experienced financial professionals at the world’s largest banks. The startup aims to create a principle financial capital and securities market disruptor by replacing the outdated and globally unsuitable $100 trillion in security and investment derivatives with traditional stock markets.

Further details can be found on AllianceBlock website.

AllianceBlock Technology

AllianceBlock protocol is a modular system designed to interconnect to interconnect to create the world’s first decentralized capital market infrastructure ecosystem, ushering in a new era in investment banking. Its services include:

• Cross Border Regulatory Compliance Rule Engine
• Compliant P2P & NFT (lending, borrowing, and investment protocol)
• Onchain & Offchain Investment Data API
• DeFi Investment Terminal
• Derivative and Structured Product Pricing Engine & Risk Analytics
• Data Tunnel
• Trustless KYC/AML and Identity Verification

The algorithm compares the size of your transaction to the marketplace depth and can assess which exchange can offer the best price. The protocal then divvies your trade into multiple trades throughout various decentralized exchanges with the least amount of reduction. To illustrate operable liquidity within a trade, 1inch employs private liquidity sources.

Legitimacy Screening of ALBT

Legitimacy screening ensures that the digital asset is a genuine project and not a scam. AllianceBlock has a legitimate product, built using blockchain technology and has public roadmap showing its development plans. London Stock Exchange Group has also signed up with AllianceBlock as a partner, for work on digitising investment banking aspects. This gives us the confidence to confirm that ALBT has an underlying fundamental value, that can be considered as “Mal” under Islamic rulings. Therefore, as a project it has legitimacy in terms of Shariah.

Is AllianceBlock project aligned with Islamic values?

The project provides a variety of DeFi products for Investment banking, as detailed above. Most of the products are acceptable under Shariah, such as AML/KYC checks. However, the derivatives and the P2P lending areas are questionable so until that aspect has been thoroughly assessed we have to reserve judgement on this project screening for now.

Financial Screening of ALBT:

Financial screening ensures that the crypto asset meets the financial criteria for Shariah compliance, if it is an equity based token. 1Inch is not backed by any equity, so there is no financial screening required on this coin/ token. Here we would typically look at things like debt to income ratio to ensure borrowing is limited to a tolerable level.

ALBT Token Screening for Shariah Compliance

Token screening is an assessment of the mechanics of the token itself, to see if it is compliant with Islamic rulings. The token can be used as a medium of exchange for the services and assets on the platform and staking. Based on this the token could be considered halal.

Is Staking 1INCH Halal?       

Staking as a concept is not against Sharia guidelines. It’s simply a set of pre-defined rules used by a crypto project to determine who gets the rights to add to the blockchain. It is important to note that every project has its own specific staking mechanism, so we need to assess the staking details to ensure they are Shariah compliant. And of course the underlying crypto asset itself mush to be halal to start off with.

The staking method mechanism by this protocol does not comply with Shariah guidelines. Staking ALBT will be rewarded by an allocated treasury pool derived from network fees.

What Does The Muslim Crypto Community Think of ALBT?           

Sharlife has screened AllianceBlock: ALBT for Sharia compliance and has doubts about this project so remains undecided, just like us.

If you know of other academic or scholarly views on this, please add in comments and we will update accordingly. Alternatively, you may want to join our community of Muslims crypto investors and traders, to share, learn and profit from halal digital assets.          

Is AllianceBlock Halal: Is ALBT halal?

AllianceBlock is a platform designed to bypass the financial system with Decentralized finance. The protocol’s interoperability feature is currently being reviewed, while the only complaint is that future products created by this protocol may not be Shariah compliant so for the time being we are unable to say for sure if ALBT is Halal or Not.

While AllianceBlock is in doubt, why dont you check out our Halal Crypto List to find suitable digital asset investments, without compromising your Islamic faith.