Methodology

1Principles

1. 1Criteria, not majorityThe verdict follows from checkable criteria. Scholars’ positions are shown alongside and affect confidence, but do not replace the analysis.
2. 2Weight, not vetoEach criterion counts in proportion to its weight; the weighted overall score sets the verdict.
3. 3Asset ≠ way of tradingA permissible asset can be traded in impermissible ways; those are assessed separately.
4. 4TransparencyEvery status has an explanation and sources; confidence comes with a breakdown of what shaped it.

2Shariah criteria (8)

Each criterion gets a status — pass, caution or fail — a score from 0 to 100 inside the status band, and a weight. The overall score is the weighted sum of the criteria scores; no single criterion decides on its own.

1. 1

   Interest (riba)

   Weight 25

   Does holding the asset produce interest?

   Pass

   No interest; rewards pay for network work (mining, validation).

   Caution

   Yield of unclear nature; staking with a disputed structure.

   Fail

   Holders earn interest (lending yield, interest-bearing reserves passed to holders, debt instruments).

2. 2

   Nature of the asset

   Weight 20

   Does the asset have real value: a working network, utility, or a claim on a real asset?

   Pass

   A working network or utility, recognised as property (mal).

   Caution

   Limited utility, or authoritative bodies disagree whether it is property (mal).

   Fail

   An empty record with no utility, a Ponzi or pyramid structure, or a claim that will not be honoured.

3. 3

   Gambling (maysir)

   Weight 15

   Do gambling mechanics or pure speculation dominate? Ordinary volatility is not maysir.

   Pass

   The main use is not speculative.

   Caution

   Heavily speculative use, but a real function exists.

   Fail

   Built for gambling: meme tokens without function, lottery or casino mechanics, betting tokens.

4. 4

   Business model

   Weight 15

   How does the issuer or protocol earn?

   Pass

   No issuer, or service fees; impermissible revenue below 5%.

   Caution

   Impermissible revenue of 5–20%, or disputed activities, or impermissible revenue is shown but its share is unknown.

   Fail

   5% or more from clearly impermissible sources (interest, gambling, prohibited industries), or 20% or more from disputed ones.

5. 5

   Excessive uncertainty (gharar)

   Weight 10

   Is there excessive uncertainty?

   Pass

   Supply, code, governance and reserves are transparent.

   Caution

   Partial opacity: closed code, an anonymous team without decentralisation, unaudited reserves, large pending unlocks.

   Fail

   Critical opacity: the issuer can mint tokens or move reserves at will without disclosure.

6. 6

   Usage

   Weight 5

   What is the asset actually used for?

   Pass

   Payments, computation, infrastructure, tokenisation of permissible assets.

   Caution

   A notable share of disputed use.

   Fail

   The main purpose is impermissible: gambling, prohibited content, interest-based finance.

7. 7

   Permissible ownership

   Weight 5

   Can the asset be held in a permissible way?

   Pass

   Fully paid spot ownership is available.

   Caution

   Permissible ownership is available only via limited or opaque routes.

   Fail

   The asset exists only as an impermissible structure (leveraged token, derivative wrapper).

8. 8

   Benefit and harm (maslahah)

   Weight 5

   Does benefit outweigh harm?

   Pass

   Clear benefit, moderate harm.

   Caution

   Significant disputed harm (environment, abuse) alongside real benefit.

   Fail

   Harm dominates: a tool for fraud, sanctions evasion or exploitation.

3From criteria to a verdict

Verdict rules are applied in order; the first one that matches decides.

1. 1Halaloverall score 75 or higher
2. 2Doubtfuloverall score 50 or higher
3. 3Not halalin all other cases

Screening thresholds

The thresholds come from share screening standards (AAOIFI, SC Malaysia) and are applied to the economics behind the token: the revenue of the issuer or protocol, the source of token yield and reserves. Without the data, a criterion cannot pass.

• Revenue from clearly impermissible sources — less than 5%
• Revenue from disputed activities — less than 20%
• Reserves in interest-bearing instruments when holders receive the interest — less than 30%

4Confidence

Confidence shows how settled the facts and scholars’ opinions are. Code calculates it from the analysis:

If more than 30% of tier-1 positions are against the verdict, it is marked “Scholars’ opinions differ”.

5Asset vs way of trading

Ways of trading and using an asset are assessed separately from its verdict: a permissible asset can be traded in impermissible ways.

• Spot

  Spot purchase with full, immediate settlement: pass for a HALAL or DOUBTFUL asset.

• ETF

  A fund that holds the asset itself is assessed like spot; the fund's structure is checked separately (no interest income, no lending of the underlying).

• Payments

  Caution where tier-1 authorities prohibit crypto as a means of payment.

• Staking

  Pass when rewards pay for validation work; caution when the structure is unclear or resembles lending.

• Margin trading

  Always fail: deferred exchange without delivery and leverage (AAOIFI SS 20).

• Derivatives

  Futures, perpetuals and options: always fail (AAOIFI SS 20: deferred exchange without delivery, leverage).

• Lending

  Lending with a fixed or guaranteed return: fail (riba).

• Yield products

  Judged by the source of the return: fail if it is interest or guaranteed; caution if the source is unclear; pass only when rewards pay for real network work.

6Strategies

Strategies are a general analysis of how well an asset fits common medium- and long-term approaches. They are not personal advice or a buy or sell signal, and have no entry zones, stop-losses or position sizes.

1. 1Medium and long horizonNo trading: clear rules that can be checked.
2. 2Code calculates, AI explainsNumbers such as the zone, drawdowns and age are calculated by code; the model interprets them together with fundamentals and the halal analysis.
3. 3Halal is a filterStrategies are not assessed for an asset that has not passed the screening.
4. 4Honest limitsWhen history or data is short, we say so.

Long-term holding

Is the asset suitable to hold for 3–5+ years as part of the core of a crypto portfolio? Each factor is rated high, medium or low.

• Durability

  Years live, cycles survived, maximum drawdown and recovery, current drawdown from ATH.

• Fundamentals

  Team and development continuity, real usage, institutional base.

• Dilution

  Supply inflation, unlocks, ownership concentration.

• Liquidity and access

  Market cap, volume, availability on reliable exchanges with permissible spot trading.

• Regulatory resilience

  Legal status of the asset class in key jurisdictions and its direction.

• Single points of failure

  Dependence on an issuer, custody, technology risks.

Accumulation by valuation zones

Where the price is relative to the asset’s own history. Code calculates the zone daily from three indicators: each gives points, and the sum of points gives the zone.

7Updates

Analyses are kept up to date automatically, on a schedule and after material events.

• Prices and market data — every 15 minutes.
• Accumulation zone — daily; its explanation — when the zone changes, or monthly.
• Market outlook for 1–3 months — weekly and after sharp price moves.
• Fundamentals and long-term holding — quarterly.
• Halal analysis — re-checked every six months.
• Legal status by jurisdiction — monthly.
• Material news about a project triggers an earlier update of the affected blocks.
• Every analysis records the methodology version it was made under. The methodology changes only through a reviewed change with a changelog entry.

8Shariah review

The approach is based on AAOIFI Shari’ah Standards (SS 21, SS 20, SS 1) and the 2020 resolutions of the Shariah Advisory Council of the Securities Commission Malaysia.

Review of the methodology by partner Shariah scholars is in progress. Their names and conclusions will be published on this page.