Islamic Coin (ISLM), a digital currency designed in accordance with Sharia principles, is set to launch on September 1, 2023, with an ambitious mission to redefine the landscape of Islamic finance. This revolutionary venture aims to appeal to an estimated global Muslim population of up to 2 billion, potentially turning ISLM into a formidable player in the cryptocurrency arena.
By July 2023, Islamic Coin had already secured a hefty US$400m in funding, marking it as a cryptocurrency to closely observe, despite the fact that this substantial backing does not necessarily ensure its ultimate success.
The world of cryptocurrencies, according to CoinMarketCap, is populated with nearly 23,000 different currencies, yet a significant portion of these are deemed ‘dead’ or forgotten, leaving just over 8,000 in active operation. In such a saturated market, ISLM, as a newcomer, needs a compelling unique selling point – its foundation on Sharia principles designed to serve the Muslim community could indeed be that distinction.
Sharia compliance, in the context of finance, involves adherence to Islamic law principles. These include prohibition of interest charges or payments, avoidance of uncertain transactions, disallowance of gambling or speculative activities, ethical and socially responsible business practices, and requirements for transactions to be backed by tangible assets. Furthermore, the system discourages excessive risk-taking and mandates a portion of profits to be allocated for charitable endeavors.
ISLM is not only predicated on these principles but was also granted a positive Fatwa, an Islamic legal opinion, by Sheikh Dr. Nizam Mohammed Saleh Yaquby, a key figure in the world of Islamic financial products. However, this Fatwa, while providing reassurance of ISLM’s alignment with Islamic teachings, is not universally accepted among all Muslim authorities, posing potential hurdles for ISLM’s acceptance.
Among those backing Islamic Coin are notable figures like its Co-Founder Mohammed Alkaff, a computer science engineer, and Sheikh Dr. Nizam Mohammed Saleh Yaquby, an expert in the Islamic financial market worth US$4.2 trillion. The team also includes Hussein Mohammed Al Meeza from Dubai Islamic Bank, Peter Raffety from Abu Dhabi Investment Authority, and Dubai royalty, Her Highness Sheikha Mariam Suhail Obaid Suhail Al Maktoum.
ISLM’s creators have also incorporated a charitable element, pledging 10% of the coin’s minted value for community welfare. This, coupled with its potential reach among Muslim cryptocurrency traders, could catapult its value to a potential $1 trillion, directing a significant $100 billion towards charity and community work.
Islamic Coin’s edge over other cryptocurrencies, including Bitcoin, comes from its unique position as a Sharia-compliant currency. Bitcoin, while popular, has been deemed ‘haram’ or unacceptable by numerous Muslim authorities, making ISLM a potentially attractive alternative.
Nevertheless, the journey ahead for Islamic Coin is fraught with challenges. Not all Muslims or Muslim authorities agree with the principles on which it’s built, and competition from established Islamic financial systems already adhering to Sharia principles could hinder its growth. Furthermore, by Q4 2023, the Islamic Coin project anticipates having integrated 20 payment firms across the Middle East and North Africa, broadening its footprint.
As ISLM’s Co-Founder Mohammed Alkaff stated, the ambition is to create a “Sharia-compliant, immutable, independent financial system” that serves not only the Muslim community but has broader, universal appeal. As for whether Islamic Coin will dethrone Bitcoin as the leading cryptocurrency, only time will tell.
