It’s clear blockchain technology is growing at a tremendous pace and revolutionizing the crypto world. Decentralized finance (DeFi) has taken the main stage with the goal of eliminating the requirement of centralized control to manage the financial system. Most of the platforms and exchanges across the crypto world are still centralized, despite the utilization of distributed ledgers to store data in a decentralized manner. DeFi’s hoping to shake things up and it sure looks to be on the right track. The total value locked (TVL) in DeFi projects rose to nearly $175 billion in early September. TVL in February 2021. only just crossed $40 billion A serial entrepreneur with a background in IT, law, and finance, Waseem Mamlouk, Vice President at Nimbus Platform, is hard at work ensuring portions of the platform are certified as Sharia-compliant. is a DAO-governed dApp ecosystem based on IPOs, lending, crypto and more, with a goal of creating a decentralized bank for platform users. Nimbus providing a range of income-generating streams With a unique perspective, we got in touch with Mamlouk to get his thoughts on DeFi and crypto as he keeps working to serve buyers who want investments to comply with their spiritual beliefs. Why do you believe government-issued fiat currencies do not have any intrinsic value and may be incompatible with a careful interpretation of Sharia law? The world’s major currencies have not been pegged to any tangible asset since leaving the gold standard with the demise of Bretton Woods in the late '60s (68-73). Over several decades, many leading economies have been running in the red compared to their assets. It’s only logical those who believe in Sharia law would search for an asset backed by a hard commodity, or at least requires a certain amount of effort to manufacture. Crypto presents a simple solution! First, a move away from currencies that are printed beyond even their physical existence and placed on balance sheets without having a physical presence is inevitable. Furthermore, anyone following (Sharia) law directly will not maintain their wealth in fiat currencies or at least seek to hedge their risk. Technically, without having an asset peg and without the currency having any intrinsic value or cost of production. In fact, fiat is fully non-compliant with Sharia law. Yes, I understand this might be a controversial take, but there’s been a lot of talk already about returning to the gold standard in the context of debt, gold, and Islamic finance. Can you brief us on the impact of cryptocurrencies within Islamic banking? Well, there have only been a few entrants so far with limited success. Crypto has struggled to thrive within the Islamic banking sector as there was some confusion even back at the beginning of the wave starting in 2010 or so as to the legitimacy of cryptocurrency in general. However, fast forward to 2021, and you have a totally different story where cryptocurrency is very logically at the center of anyone who seeks to truly make Islamic investments and avoid any confusion over the source of funds and mixing funds from other sources. Technology in crypto allows us to track the actual fund source and answers any questions about usage. Newly-minted assets can also help clear up issues about the cleanliness of the value transfer mechanism. Really, anyone who is able to marry cryptocurrency within Islamic banking is going to find themselves in the middle of a potentially very lucrative market. Pew Research the global Muslim population will rise by 70% to nearly 3 billion between 2015 and 2060. So smart financial tools geared towards the Islamic world are certainly an attractive prospect. estimates What will bring investment money from large-scale institutions to the crypto world? I think a big part is regulations that will make crypto and DeFi more similar to the existing banking system. Of course, this was bound to happen at some point. I believe the two should be joined together as opposed to those who say that crypto should just totally replace the existing traditional system. What is your verdict about the future of ethical DeFi? Ethical DeFi has a bright future and has only just begun to develop. It’s going to be so important to have a system that is holistic in nature and can cater to the needs of any client. Ethical DeFi also helps investors more as they have better data to make decisions. Instead of a traditional system of investment managers making choices, ethical DeFi permits investors to actually direct their money since they directly hold digital assets. With Blockchain and DAO technology, it is even now possible for these same community members to vote with their holdings and determine the future, especially in regard to ethically sound investment. What is the scope of DeFi in 2021? And where do you see it in the next 3 years? We have reached into the billions already and DeFi will continue to grow at a very high CAGR which will not be less than 20% compounded annually. This will make the market size impossible to ignore. DeFi will be proven to exist as the future and not just a flippant trend. Within the next three years, we might even see the DeFi market reach over $1 trillion in value (if the growth rate continues to accelerate). Of course, it’s more important to understand the immense growth potential framed in the lens of realizing many millions across the world do not have access to traditional banking tools and could harness DeFi & crypto tools to transact. What does DeFi offer that traditional markets do not? The decentralised finance market is borderless and trustless. This creates a dynamic that’s unseen in human history and opens all possibilities to create new financial instruments and a completely new paradigm for the old services that were offered previously. Many people are so tired of the slow processing times, high fees, and other regulations found all across the traditional banking world, especially since a lot of these financial institutions aren’t even the most efficient or customer-friendly. How will DeFi change the world? We already see that many of our youth in the future will not need a traditional bank account and will simply join the DeFi market to start investing and saving activities. First, I believe a hybrid system will emerge to bridge the two together. Virtual marketplaces will become the norm while visiting a physical bank will be a relic of the past. ATMs, thanks to DeFi, will be replaced by a smart device and user. What are the future plans for Nimbus and how do you hope the platform positively impacts DeFi’s growth? There’s really so much! We’re still aiming to keep growing our community, which already numbers in the tens of thousands. Nimbus’ stock exchange listing will be the first time a DeFi company achieves that. We’re happy to be such a trendsetter across the DeFi world and hope that draws more attention to the industry. I’m also personally still working hard on getting some of our different tools and solutions Sharia-compliant. Each country has their own systems and procedures in place of what it actually means to become certified, so we hope to really keep submitting proposals to Sharia councils and receive approval.
