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Follow Up Question On Propfirm Model
As-salamu alaykum,
JazakAllahu khair (umar) for your earlier replies on this. I have since asked some Arab scholars about the same paid Challenge structure, and they reached the opposite conclusion, citing specific evidence I would like your response to, since we’re all reasoning from the same texts but reaching different places.
Their core points, with citations:
1. They ground the general prohibition of maysir in Qur’an 5:90, 2:219, and 4:29, and the hadith in Bukhari (4860) and Muslim (1647) on the gravity of even inviting someone to gamble.
2. On skill: they cite the hadith “There is no prize-money except in camel racing, horse racing, or archery” (Abu Dawud 2574, Tirmidhi 1700, Nasa’i 3585, Ibn Majah 2878), arguing that since these are skill-based competitions and the Prophet ﷺ still restricted where prize-money (sabaq) is permitted, skill alone does not make payment for an uncertain prize permissible. If skill alone were sufficient, the hadith would have stated a general principle rather than naming three specific activities.
3. On the comparison to exam or licensing fees: they argue legal consideration is given to substance over wording, so calling the fee a “service fee” does not by itself change the ruling if, in substance, the fee is a condition for entering a financial contingency rather than an independent fee for a service sought for its own sake.
4. On ju’alah: they note that in a genuine ju’alah, the offeror pays the worker upon completion of a task; here, it is the trader who pays the company and places money at risk to qualify for the reward, which inverts that structure.
5. They also cited International Islamic Fiqh Academy Resolution No. 127 (14/1), which states that in a prize competition, the prize must not come from the competitors themselves.
Given this evidence, particularly points 2 and 3, does your earlier reasoning still hold — that this isn’t gambling since no rule requires anyone to fail, and that it’s comparable to exam or licensing fees? I’d value your response specifically to the sabaq hadith argument, since it speaks directly to the skill-based reasoning your answer relied on.
JazakAllahu khair.
Wassalam,
[Masroor]
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2 Replies
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Follow Up Question On Propfirm Model
updated 1 month, 1 week ago
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Replies
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Before the five points, it is worth naming where the disagreement actually sits, because you are right that we are reading the same texts.
The fork is not in the texts; it is in what a text is permitted to do. In the usul those scholars are working from, an authentic report can restrict a general Quranic permission and establish a prohibition of its own, and a fiqh academy’s collective takhrij has standing as a basis for ruling. In the framework I have been answering from, prohibitions outside food and drink come from the Quran alone — قُلْ إِنَّمَا حَرَّمَ رَبِّيَ (7:33), where innama functions as harf al-hasr and closes the list — and a report cannot found an independent directive; it must rest on the Quran or the established Sunnah. Given identical texts, the different rule about what texts can do produces the different conclusion. That is the honest account of the disagreement, and it means much of the below is not a dispute about authenticity or wording.
1. On 5:90, 2:219, 4:29, and the hadith on inviting someone to gamble.
There is no disagreement here at all. Maysir is forbidden, and forbidden gravely — the Quran calls it rijs min amal al-shaytan, and Ghamidi Sahab treats it as among the most serious categories of akl al-amwal bil-batil. But these texts establish that maysir is prohibited and how gravely; they do not define what falls under it. The disputed question is tahqiq al-manat — whether this particular arrangement is an instance of the term. Severity does not extend scope. A citation to how gravely a thing is forbidden cannot settle whether a given transaction is that thing.
2. On the sabaq hadith — the point you asked about specifically.
Three responses, in increasing order of weight.
First, the argument form. “If skill alone were sufficient, the hadith would have stated a general principle” is an argument from silence, and it cuts both ways. The report also does not name prizes for Quran memorization, for competitions in religious knowledge, for scholarship examinations, or for any of the countless awards the same scholars permit without hesitation. If the three named activities were an exhaustive restriction on where compensation may attach to a demonstrated ability, all of those would fail too — and nobody holds that. Which shows that those citing it do not in practice read it as exhaustive either; they read it as something narrower.
Second, and more decisively: the report addresses a different transaction type. Sabaq concerns musabaqa — a contest between two or more contestants where the reward rides on who beats whom. That is precisely why the classical discussion around it turns on whether the stake comes from the contestants or from a third party. The evaluation structure under discussion is not a musabaqa at all. There is no field of competitors, no ranking, no comparative outcome. The trader is measured against a fixed, published, absolute standard — a stated profit target, a stated total drawdown limit, a stated daily limit — and his result is wholly independent of how any other participant performs. That is the structure of an examination, not a race. And this is the same distinction I relied on earlier, now with its proper name: in a race someone must lose, because the outcome is comparative; in a threshold test everyone can pass, because it is absolute. The illah of qimar in this framework, among other things, is that the counterparty’s loss is a necessary condition of your gain. A race has that built in. A pass mark does not.
Third, the methodological point. Before this report can prohibit, one must ask where the general Quranic permission of compensation for effort and service is restricted to three activities. It is not — and 2:275 (وَأَحَلَّ اللَّهُ الْبَيْعَ) and 4:29 (تِجَارَةً عَن تَرَاضٍ) run the other way. A report cannot narrow a Quranic permission down to three named instances.
3. On substance over form.
I accept this principle without reservation. Calling something a “service fee” settles nothing; substance governs. Ghamidi Sahab is if anything stricter on this than most — his critique of contemporary Islamic finance is precisely that relabelling does not change what a transaction is.
So apply it. In substance, the payer receives, on payment and regardless of outcome: platform access, live market data, an audited evaluation environment, and a graded assessment of his performance. Those are delivered, not contingent. Only the reward is contingent — and a contingent reward attached to a delivered service is an ordinary commercial structure.
Their proposed test — whether the fee is “an independent fee for a service sought for its own sake” — is worth taking seriously, but notice two things. It is not a Quranic criterion; the Quranic criterion is whether wealth is taken by a false route (2:188). And it proves far too much. Nobody sits a bar examination, a medical licensing examination or a CFA level “for its own sake.” Such fees are paid entirely as a condition of qualifying for a contingent future benefit; they are non-refundable; in some of these examinations most candidates fail; and the examining body’s revenue comes substantially from candidates who never qualify. If “a fee paid as a condition of entering a financial contingency” were the mark of maysir, professional licensing worldwide would be maysir. It is not — because the candidate received the examination he paid for, and the qualification is awarded on merit rather than by lot.
4. On the jualah inversion.
The apparent inversion comes from treating one arrangement as a single contract when it is two.
In the first, you buy an evaluation: you pay, they deliver the assessment. Customer pays provider — the ordinary direction. In the second, having qualified, you enter a performance-based arrangement in which the firm pays you for results. Offeror pays worker — again the ordinary direction, and structurally sound jualah.
You are not paying for the reward. You are paying for the assessment that qualifies you to enter the second arrangement. Every licensing regime has this shape: you pay the board for the examination, and thereafter the employer pays you. No one describes that as an inverted jualah. And note that their own framing concedes performance-based compensation to be legitimate — which reduces the entire dispute to the fee, i.e. to point 3.
5. On IIFA Resolution No. 127 (14/1).
Two things, said with respect for the body concerned.
A fiqh academy resolution is considered collective ijtihad. It carries the weight of the reasoning behind it, and in this framework it cannot by itself establish a prohibition the Quran has not — otherwise the authority to declare things Haram has passed from Allah to a committee, which the Quran addresses directly at 7:32–33.
More to the point, the rule as stated does not reach this structure. “The prize must not come from the competitors” is a rule about a prize pool — a defined pot, subscribed by the entrants, awarded to a winner. That is exactly the right rule for that subject, because there the entrants’ money is the prize and selection merely redistributes it. Here there is no pool. Each participant holds a separate bilateral contract with the company. Fees are the company’s revenue, which it spends on infrastructure, staff, marketing, hedged positions and payouts. Your claim is a contractual claim against the company for your own performance, not a claim on a fund the other participants subscribed to. Corporate revenue funding someone’s compensation is not “the prize coming from the competitors”.
And as noted earlier: in insurance, a claimant is necessarily paid out of the premiums of those who never claim. Ghamidi Sahab holds insurance permissible and in fact calls it an extraordinary institution. So the bare fact that money reaching one party originated in payments from others who received nothing back is not, in this framework, a ground of prohibition.
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Amazing reply, I’ll forward it to the sheikhs inshaAllah!
Jazakallah hu khair.
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