How is iAUSD Halal?

The iAUSD structure avoids riba because the platform never gains from issuing the loan. iA does not charge any fees for the loan and any yield is tied to the token itself and benefits whoever holds it, not the lender. Furthermore, the borrower isn’t forced to “share” their rewards with others; instead, the yield simply follows the token, much like dividends follow shares.

One might suspect that iAUSD is a debt certificate since it's minted at the time of a loan. However that can't be the case because only the borrower can repay a loan. A person who buys iAUSD on the open market cannot repay the loan and reclaim collateral.

Key Halal Points

• No Riba: The lender never benefits — only the token holder enjoys the yield.

• Yield follows the token: Like dividends on shares, benefits move with ownership, not as a loan condition to enrich the lender.

• Not debt trading: iAUSD is a minted asset, not an IOU, so using or trading it doesn’t count as selling debt.

Read our entire shariah paper here written by Dr Farrukh Habib & co-signed by Sh Saifullah Rouger.