Crypto exchange Bybit has recently announced the launch of new products that are in compliance with Islamic law, catering specifically to Muslim investors. Bybit’s co-founder and CEO, Ben Zhou, revealed on social media platform X that the trading platform now offers a Crypto Islamic account. This account provides access to spot trading of Shariah-compliant tokens, as well as a dollar-cost averaging (DCA) bot and a spot grid bot.
According to Bybit, its Islamic account respects the principles of the Islamic faith, enabling investors to trade while staying true to their religious beliefs. The exchange has developed these products in consultation with Zico Shariah, a Malaysia-based advisory firm specializing in Islamic law.
The Islamic finance system, which is based on Shariah principles, prohibits the payment or charging of interest on loans and emphasizes fair and ethical financial transactions. Instead, Islamic finance focuses on profit and loss-sharing agreements between borrowers and lenders. This means that borrowers and lenders share the risks, profits, and losses associated with investments.
Islamic law permits investments in goods such as stocks, bonds, and digital assets like cryptocurrencies. However, these cryptocurrencies must adhere to the principles of Islamic finance. To be compliant, crypto assets must operate on a profit-and-loss sharing system, where investors share in the profits and losses of the business rather than receiving a fixed return on investment. Additionally, a supervisory board must review and certify the tokens before Muslim investors can purchase them. The certification process involves a comprehensive evaluation of the tokens’ features and design.
Bybit’s introduction of this new Shariah-compliant product aligns with its recent acquisition of a license in the United Arab Emirates (UAE), a country where Islam is the official religion. Bybit obtained a provisional license in Dubai, an emirate within the UAE, on September 16. The Virtual Asset Regulatory Authority (VARA), Dubai’s crypto regulator, granted Bybit a non-operational license two years after the exchange established its headquarters in the emirate. The provisional license will become active once Bybit fulfills certain requirements set by VARA.
Helen Liu, Bybit’s chief operating officer, expressed that Dubai’s location, policies, and business environment present numerous opportunities for crypto businesses and investors.
Overall, Bybit’s launch of Shariah-compliant products and its acquisition of a license in Dubai demonstrate the exchange’s commitment to catering to the needs of Muslim investors and expanding its presence in the Middle East.