Deenar (DEEN): A New Shariah Compliant Stablecoin Backed by Physical Gold

Stablecoins are known for their distinctive "stable" feature that separates them from other types of digital assets that are highly volatile and are easily affected by market sentiment, but a new stablecoin is breaking even more barriers as it is not only Shariah compliant, but it is also a token backed by a "non-political" asset.

A new stablecoin, known as Deenar (DEEN), has recently entered the cryptocurrency market, aiming to stand out with its unique characteristics. Unlike most stablecoins that are pegged to fiat currencies, DEEN is backed by a "non-political" asset—one gram of gold.

The stable token is issued by fiduciary standard and registered in Switzerland, ensuring compliance and security. It is also built on ERC-20 protocols and is compatible with HAQQ and Ethereum wallets.

DEEN tokens are redeemable to high-purity physical gold, and are 100% halal digital coins. A very significant feature of the Deenar is that 1% of sales goes to charity, paving the way for a more purposeful way of using crypto.

In an exclusive with International Business Times, Maruf Yusupov, the co-founder of Deenar, talked about the journey toward launching the token, what makes it special, and why it could be a better investment than physical gold.

The goal in the journey to creating Deenar was to develop a stablecoin that "genuinely stands out." To achieve the said goal, the team prioritized determining which reserve should back the token to ensure its stability. Most stablecoins are pegged to fiat currencies, but the Deenar team opted for a completely different route forward.

"Gold provides a tangible and reliable asset base, making Deenar a stable hedge against inflation and economic uncertainty," he said. He noted how the value of major fiat currencies such as the U.S. dollar and the euro has largely been affected by inflation in the last decade.

The Deenar provides a host of benefits for its users – stability and purposeful transactions – but there are three top qualities that make it stand out in the stablecoin market.

First, the digital coin is backed by gold, which Yusupov notes is a "non-political" asset. "It's not tied to any one country's economic policies. It's a global asset that remains valuable regardless of the actions of individual governments," he explained.

Yusupov's comments are backed by data. Tether (USDT), a U.S. dollar-backed stablecoin, has been on a rocky path in the past 24 hours, as per data from CoinGecko. The same can be said about the USD Coin (USDC), another stablecoin pegged to the U.S. dollar.

Another top distinctive feature of the DEEN is Shariah compliance. "Our stablecoin is potentially the only halal option in the industry. We've ensured that Deenar is fully compliant with Shariah law, avoiding practices like interest (riba) and maintaining ethical financial dealings," Yusupov said. The token has also received a fatwa to reflect its Shariah compliance.

Finally, the Deenar is a digital asset championing inclusion. For the DEEN team, it is crucial to reach unbanked and underbanked populations, especially in Muslim-majority regions. "By leveraging blockchain, this stablecoin offers secure, low-cost financial transactions, making it an accessible tool for those who have traditionally been excluded from the financial system," Yusupov said.

In an age where people are in search of assets that will give them the best gains from their investments, the Deenar offers an alternative to the hassle of physically managing gold.

For one, storing physical gold is very complex and can be very expensive. DEEN, the first gold-backed token on Cosmos, either eliminates or significantly reduces the costs that come with physical gold storage. "You're basically investing in a digital version of gold, which is a far more cost-effective option for investors who want to avoid the overhead associated with physical storage," Yusupov said.