What is Layer 2?
Layer 2 is a technology built on top of a main blockchain (e.g., Ethereum) to process transactions off-chain and then settle them on-chain. This reduces congestion, lowers fees, and speeds up execution. In Islamic finance, it must avoid riba and gharar, which Qist ensures.
Why Does Layer 2 Make Transactions Cheaper?
Instead of executing every transaction on the expensive main chain, Layer 2 bundles dozens or hundreds of transactions into one and submits it to the main chain. This drastically reduces the cost per transaction. For example, Ethereum fees can be dollars, while on Layer 2 they drop to cents.
Compatibility with Islamic Finance Principles
At Qist, we use Base (a Layer 2 on Ethereum). The seller owns the asset until full payment, installments are paid in USDC (a stablecoin), no riba or gharar, and excess is refunded. The contract is open and verified on BaseScan, ensuring transparency.
Examples of Layer 2 Technologies
Popular solutions include Optimistic Rollups, ZK-Rollups, and Plasma. Qist chooses Base because it's built on OP Stack (Optimism) and offers Ethereum's security with low fees. This makes decentralized Islamic finance accessible to all.
How Qist Applies This
Qist deploys financing contracts on Base (Ethereum Layer 2). Transactions are processed off-chain and settled on-chain, reducing fees to under $0.01. With a 3-day grace period and only 2% fee, over 1.9 billion Muslims can access fair and flexible financing.
Discover Qist: qist.info
Informational content, not financial advice.