🕌Shariah Compliance

Is The LifeDAO Shariah-compliant?

Yes. TLD is designed from the ground up to follow Islamic finance principles.

Here's how:

• No riba (interest): All funds avoid debt-based returns. We use risk-sharing models like mudarabah instead.

• No gharar (uncertainty) or maisir (speculation): TLD is based on mutual donations (tabarru’), not commercial contracts or bets on outcomes.

• Transparent smart contracts: All processes are automated, public, and tamper-proof.

• Independent Shariah Board: A qualified board vets and approves everything—from investments to product design—based on AAOIFI standards.

• Ethical use of funds: Investments are screened to avoid haram sectors like alcohol, gambling, or weapons.

In short: Shariah compliance isn’t an add-on. It’s built into how TLD works.

👉 Take a look at the full Shariah-section here for more details.

Isn’t TLD's Life Protection Benefit just insurance in disguise?

No, it’s fundamentally different. The Life Protection Benefit is built on a mutual aid model, not a commercial insurance contract. It’s based on tabarru’ (voluntary contribution), where members support one another; not buy or sell risk.

There are no fixed premiums, no guaranteed payouts, and no profit-driven contracts. Instead, it’s a community fund, governed by members, designed to provide support when someone passes away. That means no interest, no speculation, and no conflict with Shariah principles; just people helping people, with transparency and trust.

Where does my money go - and is it really halal?

Your contribution goes into a member-owned, Shariah-compliant fund. This fund is only used to support member benefits (like Life Protection payouts), maintain operational infrastructure, and invest in halal ventures. Every investment and expenditure is screened by the Shariah Board and tracked transparently on-chain, so nothing can be hidden or misused.

What’s the proof that TLD is actually Shariah-compliant?

TLD follows the principles outlined in AAOIFI Standard 26, which governs Islamic insurance and mutual protection. All models, contracts, and operations are reviewed and approved by an independent Shariah Board. This board has full authority to block or amend any feature that contradicts Islamic principles. Their decisions are binding, not symbolic.

Doesn’t mutual protection still carry risk like gambling (maisir)?

No. Maisir (gambling) involves gaining something at the expense of another through pure chance. TLD avoids this by using tabarru’, where all contributions are intended as donations.

Members agree to share in losses and benefits collectively. There’s no speculative gain, and no one profits off another’s misfortune. The intention and structure are fundamentally different from gambling.

Is there any interest (riba) involved in TLD at any level?

No. TLD is structured to be entirely free from riba (interest). There are no interest-based loans, bonds, or credit products involved. Contributions are not treated as debts or investments with guaranteed return.

Profits are only generated through halal investment mechanisms, such as mudarabah (profit-sharing) or wakala (agency), and losses - if they happen - are transparently shared.

What about gharar; how do I know TLD isn’t full of ambiguity?

Gharar (excessive uncertainty) is common in conventional insurance where the terms can be vague or deceptive. In contrast, TLD uses open-source smart contracts to lock in all terms and conditions transparently.

There is no ambiguity about how funds are used, how payouts are calculated, or who qualifies. Every step is pre-defined and publicly auditable.

Who decides whether something in TLD is halal or not?

TLD is governed by an independent Shariah Board made up of qualified Islamic scholars and finance experts. They assess everything from the product structure and governance to marketing language and tech features.

If something doesn’t align with Shariah, they can reject it outright. Their decisions are binding on the organization, not just advisory.

What if TLD makes changes later that aren’t Shariah-compliant?

That can’t happen without scrutiny. Any major changes to how TLD works must go through two layers: the Shariah Board, who have veto power, and the DAO governance vote by members. The smart contract structure also prevents unilateral backdoor changes. Compliance is baked into both the tech and the process.

Is blockchain technology even allowed in Islam?

Blockchain is a tool; it depends how it’s used. Scholars agree that technology is permissible by default unless it leads to haram outcomes. TLD uses blockchain to enforce transparency, fairness, and traceability, not for speculation or unregulated crypto trading. All funds and decisions are traceable and secure, which strengthens Shariah compliance.

Are the TLD credits I receive considered halal?

Yes. TLD credits represent membership rights, not speculative assets. They cannot be traded or sold for profit, and they don’t guarantee financial return. They are simply a record of your contribution and your share in any community surplus. This avoids the speculation and volatility found in many crypto projects.