The Problem of Inflation in Fiat Currencies
Fiat currencies suffer from chronic inflation due to the ability of central banks to print money without full backing. This erodes purchasing power over time, harming savers and creating economic instability. Over the past decades, major currencies like the US dollar and euro have lost more than 90% of their original value. For Muslims, this inflation also poses a Sharia issue, as imposing loss of purchasing power on others may constitute injustice (zulm).
The Islamic Alternative: Real Assets Backing Money
In Islamic finance, money must be backed by real assets to avoid riba (usury) and gharar (uncertainty). Fiat currencies are unbacked, contradicting Islamic economic principles. Islamic solutions include using gold, silver, or asset-backed digital currencies. 'Qist' applies this principle by enabling users to purchase real assets (e.g., real estate) in installments with the seller retaining ownership until full payment, thus protecting value from inflation.
Why Muslims Seek Alternatives
Muslims worldwide, especially in high-inflation countries like Lebanon, Syria, and Turkey, suffer from collapsing currency values. They seek safe havens that preserve savings and comply with Sharia. Cryptocurrencies like Bitcoin (capped at 21 million) offer a potential solution but lack real asset backing. 'Qist' bridges this gap by combining Islamic finance principles with blockchain technology.
How Real Assets Preserve Value
In the 'Qist' model, users pay USDC (a stablecoin) to purchase a real asset such as property. The asset remains owned by the seller (Qist) until full payment, ensuring protection from inflation as the asset's value is tied to the real market. Upon sale, any surplus is returned to the buyer per profit-sharing principles. This safeguards savings from inflation and prevents riba, as no interest is charged on installments.
How Qist Implements That
Qist is a decentralized Islamic finance platform on Base using open-source smart contracts verified on BaseScan. It allows users to buy real assets in installments with only 2% fees and zero interest. Assets are owned by the seller until full payment, and installments are paid in USDC. A 3-day grace period is provided for late payments without penalties. All transactions are transparent and Sharia-compliant, offering a genuine value-preserving alternative.
Discover Qist: qist.info
Informational content, not financial advice