Digital Waqf: Concept and Importance in Islamic Economy
Digital Waqf is the application of the traditional Waqf principle using modern technologies like smart contracts and blockchain. It aims to collect funds from Muslims worldwide in a transparent and auditable manner, where assets (such as USDC) are deposited into a smart contract that manages the Waqf automatically. Digital Waqf can serve social projects such as mosques, hospitals, and schools, while ensuring compliance with Islamic Shariah.
Financial Potential of Digital Waqf: How Much Can It Raise?
With ~1.9 billion Muslims and the Islamic finance industry at ~4 trillion USD, digital Waqf could raise billions of dollars. For example, if 10% of Muslims participate with an average of $10 per year, the proceeds could exceed $1.9 billion annually. These funds can be invested in Shariah-compliant assets (e.g., real estate or commodities) and generate returns distributed to charitable projects.
Ensuring Shariah Compliance in Digital Waqf
Digital Waqf contracts are designed according to Shariah principles: the asset remains owned by the Waqf (seller owns the asset), and no Riba (interest) or Gharar (excessive uncertainty) is involved. USDC is used as a stablecoin to avoid volatility, and any surplus is returned after asset investment. A 3-day grace period allows donors to withdraw, ensuring fairness. The contract is open and verified on BaseScan for transparency.
Role of Qist Platform in Enabling Digital Waqf
Qist is a decentralized Islamic finance platform on Base, providing smart contracts for digital Waqf. It charges only 2% fees to cover operational costs. Users can create a Waqf or donate directly using USDC. Assets are distributed across multiple wallets to reduce risk, and donations can be tracked in real-time on-chain. This ensures funds reach beneficiaries efficiently and transparently.
How Qist Implements This
Through Qist, any Muslim can create a digital Waqf in simple steps: choose the asset (USDC), define the charitable project, and deploy the smart contract. The contract automatically collects donations, invests them in Shariah-compliant assets (e.g., trade financing or real estate), and distributes profits to the specified projects. All transactions are recorded on the Base chain, ensuring transparency and trust.
