Dr. Ismaeel Kolawole Yunus, a lecturer of Islamic Finance from the Department of Islamic Law at Crescent University, Ogun State, has cautioned against a growing trend known as “tapping” in cryptocurrency circles, citing Islamic financial principles.
Speaking on Sunday, October 27, 2024, at Enuwa Central Mosque in Ile Ife, Osun state Dr. Yunus addressed the 3rd Annual An Nadwah Scholars Colloquium organized by the Standard Bearers Islamic Organization, themed “Modern Business Transactions in the Light of Qur’an and Sunnah.”
In his speech, Dr. Yunus explained that “tapping” has become widespread on platforms like Telegram, often enticing newcomers with initial token allocations of up to $500, which may increase as they continue to participate.
However, he noted that these rewards are often ambiguous and unpredictable, creating significant uncertainty around potential earnings.
According to Dr. Yunus, “tapping” requires participants to invest their resources indirectly by engaging in tasks such as visiting websites, watching YouTube videos, and interacting on Twitter and Telegram channels.
The activity, he explained, becomes more than a time commitment: it involves real financial costs for data usage, with no guaranteed returns. “For example,” he said, “if you spend ₦2000 on data but only receive $1 in return, you’ve effectively made a loss. In crypto terms, this is often called ‘dust,’ small, seemingly insignificant returns that don’t add up to meaningful value.”
Dr. Yunus also emphasized that the structure of these platforms bears resemblance to Multi-Level Marketing (MLM) schemes, where only those at the top tiers earn significant rewards, leaving newer participants with minimal benefits due to limited access and opportunities to “tap” more tokens.
He further elaborated on why this model poses issues under Islamic finance principles. In Islam, investments and transactions should avoid excessive uncertainty (gharar). If the potential gain from an activity is not transparent or guaranteed, then it falls under speculative transactions, which are considered haram.
“In this tapping model, participants often expect returns based on engagement, yet the actual payout remains uncertain until it is rated or ‘leased.’ This lack of clarity violates Shariah principles,” Dr. Yunus stated.
Concluding his remarks, Dr. Yunus advised Muslims to approach such practices with caution, as tapping represents a form of speculative gain filled with ambiguity, making it incompatible with Islamic finance ethics.
