German FinTech company Caiz Development is building a Sharia Compliant Cryptocurrency and blockchain designed to unlock financial opportunities for millions of underbanked people in developing countries.
Caizcoin will comply with the principles of Islamic finance. The blockchain will also offer transactions respecting Sharia rules.
“In 2018 and 2019, we came up with the idea of building a cryptocurrency that can be used in the Islamic world under all its restrictions, such as no interest, knowing your counterparties, no anonymity or speculation,” said Joerg Hansen, chief executive of Caiz. Development.
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“We conferred with Islamic scholars if permitted before deciding to design the token. We did our best to make Caiz compliant with Islam, but we also wanted to create an inclusive product that could be used by everyone .
The The Mena region is the fastest growing cryptocurrency market worldwide, accounting for 9.2% of global digital currency transactions from July 2021 to June 2022, according to a report published this month by blockchain data platform Chainalysis.
About 22% of the GCC population is unbanked, compared to 60% in North Africa, according to a report by consultancy firm Strategy &.
According to the Arab Monetary Fund, 79% of young adults in the Mena region are unbanked and 72% of the poorest citizens can benefit from financial inclusion.
FinTech has identified remittances as one of the biggest issues for migrant communities, not only in the Islamic world, but globally.
“The strongest use cases for Caizcoin are not in the United States or Europe, where everyone has a bank account. Instead, it is unbanked and underbanked users in countries in developing countries where financial services penetration is less,” Mr. Hansen said.
“They can download the app, buy Caiz and send it to a recipient, who can use it within our ecosystem for different purposes or cash it in a local currency.”
The company’s main markets are in Southeast Asia, the Middle East and Africa, as well as migrants in Europe and Latin America.
Cryptocurrencies are usually available on decentralized exchanges, where users deal with unknown counterparties and unknown risks.
However, Caizcoin will operate in an ecosystem where there will be “checks and balances” for all wallet holders. Only someone who has been vetted and verified can enter the system, Hansen said.
With its “know your customer” principle, Caizcoin does not support partnerships with industries prohibited by Islam, such as alcohol, drugs, gambling and pornography.
The company, which currently has a marketing office in the United Arab Emirates, is also building the token on a custom blockchain.
“We’re not building a coin on top of Ethereum, for example. We have forged an underlying technology, the Stellar Chain, so that we can build it from the ground up,” Hansen said.
Caizcoin founders will also engage in charitable activities and champion social causes. For example, Caiz Development recently sponsored the Euro sculpture in Frankfurt, Germany.
The FinTech company also plans to build children’s football academies in Singapore, Malaysia and Indonesia.
Caiz Development will implement its custom-built blockchain and application programming interface to connect it to financial service providers, banks and payment gateways in Q1 2023.
“We will have a Caiz wallet and app so people can access the ecosystem without a bank account and only from their mobile phone,” Hansen said.
Caizcoin is still in the fundraising stage.
“Even though we have done private sales, we will be launching exchanges on many exchanges to broaden fundraising for further expansion of the coin this year,” Mr. Hansen said.
“It will still be on the Ethereum blockchain and we will be moving to the Stellar blockchain in January or February.”
Currently, Caizcoin is available on five exchanges, including P2Pb2b, BigOne, Biconomy, and Bittrex.
“Anyone who already has Caiz from the pre-sale can deposit the parts there. Once market conditions stabilize, we will allow access to people on exchanges,” Mr. Hansen said.
The company will approach one or two top exchanges this year or next, he said.
The developer is also set to launch an Islamic alternative to staking in a few weeks in partnership with an exchange.
Staking is a way to generate passive income waiting for cryptocurrency assets to appreciate in value.
Staked coins are similar to savings accounts or interest-bearing bonds, as they all provide interest income on an initial investment.
Updated: October 21, 2022, 7:23 a.m.