What Layer 1 evaluates
Layer 1 asks: what does the protocol actually do, and is its core activity halal? Three exclusion categories drive the call:
- Riba — interest accrual at the protocol level. Lending markets where the token represents a claim on interest income. T-bill-collateralised stablecoins that pass yield through. Auto-rebasing tokens whose supply schedule tracks an interest index.
- Maysir — gambling and lottery mechanics. Casino tokens. Prediction-market governance whose primary revenue is wagers. Pure meme coins with no underlying utility.
- Haram sector exposure — adult content platforms, conventional finance fractional ownership, insurance risk pools, alcohol/pork industry tokens.
Concrete passes and fails
Passes: BTC (no protocol-level activity beyond settlement), ETH (general-purpose computation), SOL (high-throughput Layer 1), MATIC (Layer 2 scaling), LINK (oracle network).
Fails: AAVE (lending protocol governance — riba), MKR (stablecoin issuance backed in part by interest-bearing collateral), DOGE (no underlying utility — maysir), USDY/SDAI (yield-bearing stablecoins — riba).
What about Mashbooh
Some coins land in a 'maybe' state — Mashbooh — where Layer 1 evidence is mixed or where the protocol's mix of activities is borderline. Examples include some exchange tokens used for both halal trading discounts and futures fee discounts, and some staking-derivative tokens. These are excluded by default; an opt-in is available with a stated caution.
How re-evaluation works
Layer 1 is re-applied quarterly across the universe and immediately on any major tokenomics, governance, or revenue-model change. A coin can move into or out of the universe between quarterly cycles if its protocol shifts.