FAQ & Glossary
FAQ
Is this really different from interest, or just interest renamed? The contract type creates different obligations, not just different words. A sale price is fixed and capped: it cannot grow past the disclosed number for any reason, while a loan balance can. Early exit forgives the unearned portion, whereas an interest lender has nothing to forgive. Nothing is ever added to the debt for late payment. Those differences change outcomes: the 2024 rate environment cost a $1M variable borrower ~$94k, while the equivalent murabaha cost was fixed at $50k.
Where does LP yield come from? From borrowers' contracted markup, streamed block-by-block as it accrues, and from nothing else: settlement fees and liquidation proceeds are never depositor income. It is a claim against overcollateralized debt, the same backing model as Aave/Compound, with the difference that every claim's total is written into a contract at origination.
Is the yield guaranteed? No, and it must not be. LP capital is mudarabah: profit-sharing with loss-bearing. Guaranteed returns to capital would break the structure's permissibility. What is fixed is each borrower's obligation.
What happens if nobody borrows? LP yield falls toward zero (mitigated at launch by the POL utilization band, and in Phase 2 by RWA yield on idle capital). Cheap lockable fixed rates at low utilization are themselves the demand magnet, which is the bootstrap flywheel.
Can my borrowing cost ever exceed the number I saw at confirmation? No. The contract price is recorded on-chain as the debt itself. It is a ceiling by construction, not by promise.
What if I can't repay by day 360? You appointed Rayyan as your agent when you opened the position, so the keeper sells enough collateral at market price to settle what you owe, charges an agency fee of 0.25% of the amount settled (minimum 1 USDC), and returns everything else to you. Closing yourself first costs nothing beyond gas; the app counts down. (The live Sepolia deployment still charges the earlier 1.5% of collateral value until the next deployment.)
Why USDC? Is a stablecoin halal? USDC is the deepest, most institutionally accepted on-chain dollar. Whether a dollar-pegged stablecoin is money (nuqud) or a digital asset (sil'ah) is open jurisprudence. See Shariah Compliance for both sides of the argument. It is the first question our board engagement addresses.
Who controls the protocol? A governance account (multisig + timelock at launch) sets curve shape, collateral factors, the LP split, the ibra' factor, and the Closer address. It cannot change the terms of any existing position, every position's rate, cap, and ibra' factor are locked at borrow.
Is the code audited? Not yet, pre-launch. What exists today: 40+ tests with exact-value assertions, fork tests against live Arbitrum, six fuzzed invariants including strict solvency, and an independent line-by-line spec review. Two professional audits are planned before mainnet, with the open-items list published in Security & Risk.
What chains? Arbitrum One first (Compound V3 already lives there; deep liquidity; low fees). Multi-chain (starting with Southeast Asia-relevant networks) is roadmap.
Glossary
| Term | Meaning |
|---|---|
| Murabaha | Cost-plus-markup sale with the total price fixed at contract; ~80–90% of global Islamic banking |
| Ribh | Legitimate trade profit (the markup), distinct from riba |
| Riba | Interest or usury: any contractual increase on a loan, categorically prohibited |
| Ibra' | Rebate of unearned markup on early settlement; enforced by code in Rayyan |
| Mudarabah | Profit-sharing partnership: capital provider bears losses, shares profits; the LP structure |
| Rahn | Pledged collateral securing an obligation (AAOIFI Standard 39) |
| Gharar | Prohibited contractual uncertainty, excluded by full upfront disclosure |
| Tawarruq | Commodity round-trip financing used by banks; Rayyan does not use it |
| Contract price | Principal + full-term markup; the on-chain recorded debt and absolute cost ceiling |
| Settlement date | The 360-day maturity every position carries |
Contract price cap / contractPriceCap | The on-chain field holding the ceiling |
| Supply index | The per-share value multiplier through which LP balances grow (Compound V3 mechanism) |
| POL | Protocol-owned liquidity, treasury capital used to hold the utilization band |
| Keeper | The off-chain agent performing maturity settlement (as the borrower's appointed agent), liquidation, and band management |
| AAOIFI | Accounting and Auditing Organization for Islamic Financial Institutions, the standards body referenced throughout |