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Top 10 Terms You Must Understand Before Anything in Decentralized Islamic Finance

New to decentralized Islamic finance? Here are 10 essential terms that will help you understand how Qist and Sharia-compliant financing work.

1. Riba (Usury/Interest)

Riba is any stipulated increase on loans or debts, strictly prohibited in Islam. In decentralized Islamic finance, we ensure all transactions are riba-free, whether in payment or receipt. Qist enforces this via open-source smart contracts with zero interest.

2. Gharar (Uncertainty)

Gharar refers to excessive ambiguity or risk in contracts. Islam prohibits deals with high uncertainty or hidden terms. Qist eliminates gharar by setting transparent and fixed conditions in every financing contract, so both parties know their rights and obligations clearly.

3. Murabaha (Cost-Plus Financing)

In Islamic finance, the seller buys the asset and then sells it to the buyer at a markup paid in installments. No interest-based lending, only a real sale. Qist follows this: you own the asset first, then pay in USDC installments.

4. Surplus Refund (الفائض يُرد)

If the buyer defaults and the seller sells the asset, any surplus over the remaining debt is refunded to the buyer. This ensures fairness, unlike conventional finance where the seller keeps everything. Qist automates this via smart contract logic.

How Qist Implements This

Qist builds all contracts on Islamic principles: the seller owns the asset, payment in USDC (stable and lawful), no riba or gharar, surplus refund, and a 3-day grace period. Every contract is open-source and verified on BaseScan, with a 2% fee only.

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Informational content only, not financial advice