HALAL Screening Cryptocurrency
Is PancakeSwap Halal?
Complete Shariah Compliance Screening of PancakeSwap to determine if it is a Halal or Haram cryptocurrency
Legitimacy Screening
What is PancakeSwap
CAKE is the native cryptocurrency of the PancakeSwap platform, which is a decentralized exchange built on the Binance Smart Chain. Think of it like a digital marketplace where people can trade various cryptocurrencies without needing a middleman, like a bank. CAKE is used for a few things on the platform, like trading fees, staking to earn rewards, and participating in special events or lotteries. It’s a fun way for users to engage with the crypto community while potentially earning some extra tokens!
What makes CAKE unique is its focus on providing a user-friendly experience with lower transaction fees compared to other platforms, like Ethereum. PancakeSwap also offers features like yield farming, where users can earn more CAKE by providing liquidity to the exchange. Plus, it has a playful theme with cute graphics and a vibrant community, making it feel more approachable for newcomers to the crypto world. Overall, CAKE combines fun and functionality, making it an exciting option for anyone looking to dive into decentralized finance!
Transparent and Credible Team
The PancakeSwap team is anonymous, referred to as "chefs". While there are two known members, Hops and Thumper, the anonymity of the broader team raises concerns about transparency and accountability. This is unlike the example screenings provided where named founders with relevant experience are noted. Therefore, a lower score is appropriate. Score: 50
Clear Use Case or Purpose
PancakeSwap's mission is to empower users with decentralised trading and swapping of tokens, aiming to democratise finance. It operates as a decentralised exchange (DEX) using an Automated Market Maker (AMM) model. It also offers other features such as yield farming, staking, prediction markets, lotteries and an NFT marketplace. This demonstrates a clear and legitimate use case beyond mere speculation. The whitepaper documentation, while not a single document, is extensive and well-documented, according to the report. The project is not a meme coin unlike ORDI, which is considered risky. Score: 90
Absence of Fraudulent Behavior
PancakeSwap has undergone multiple security audits by reputable firms like Certik, PeckShield, and SlowMist. The platform also employs multi-sig for contracts and enables a time-lock feature, which enhances security. This indicates a commitment to security and reduces the risk of fraudulent activities. However, a "PancakeSwap Giveaway" scam is mentioned, highlighting risks for users. Therefore, a good but not full score is warranted. Score: 80
Ethical Practices
PancakeSwap emphasises transparency, security, and community involvement. The platform uses open-source code and has undergone multiple security audits, reflecting a commitment to ethical practices. However, the report notes that the platform does not comply with traditional KYC/AML regulations, which might be seen as an area of concern. There are also partnerships with Betfury which is a gaming and gambling platform, which may be considered controversial. Therefore, a good but not perfect score is appropriate. Score: 70
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PancakeSwap Halal Project Screening
- Are the project’s purpose and operation Shariah Compliant.
- Does the project operate ethically and transparently, without harm to society.
- Does the project promote positive societal or environmental outcomes.
PancakeSwap Financial Screening
- Does the revenue involve Riba (interest), Gharar (excessive uncertainty), or Haram activities.
- What red flags are hidden within the projects finances and are within permissible limits.
- Types of revenue generation activities and the percentage that may be Riba or interest based.
- Audits from reliable sources
PancakeSwap Token Screening
- Is the Token governance fair and ethical?
- Are profit-sharing mechanisms (e.g., staking rewards, dividends) compliant with Islamic Finance?
- Does the token’s design, or unlock schedule raise unethical concerns?
- Halal underlying asset, and free from impermissible elements
Is Staking PancakeSwap Halal?
- Are the staking operation aligned with Shariah-compliant structures.
- Does the staking avoid Gharar (excessive uncertainty) and Maysir (gambling)?
PancakeSwap Shariah Compliance Score
- Total Shariah Compliance Score out of 100
- 27 different components researched
- More comprehensive than any other platform