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Staking Cryptocurrency
As salamu alaykum,
Is staking cryptocurrency halal? For example, you’re awarded additional coins at fixed APY (annual percentage yield) when you stake coins for specific time.
Thank you
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3 Replies
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Staking Cryptocurrency
updated 7 months, 3 weeks ago
3 Members
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3
Replies
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From what I’ve understood after studying crypto stake pools is that:
i) If a person has sound technical skills, then this can be done without any intermediary i.e. there’s no borrower involved. The software algorithm decides the new/additional coins without any human intervention.
ii) Riba is in transactions where there is a loan involved i.e. borrower and a lender, with lender demanding an additional amount over and above the principal amount, thus resulting in oppression and exploitation. In crypto-staking, the lender is not demanding the return, it is infact the software which determines it, which reduces the element of oppression and exploitation. Infact, the additional coins given to the investor are not resulting in oppression and exploitation of any other party to begin with.
Therefore, I personally do not find an element of riba in such transactions.
P.S. I am not an expert in this matter, neither am I a scholar.
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Thank you @UmerQureshi
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In staking, either you are a validator (that directly votes) or you are a delegator who delegates his vote to validators. The validator verifies the block and gets rewarded in return.
The problem with this is the block can contain transactions of ribaa and gambling as well. And validator by validating blocks supports them as well.
So avoid it.
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