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1INCH

1INCH (1INCH)

AI Assisted Shariah Verdict
Last Update: 8/3/2026
Haram

SUMMARY

1inch operates a fundamentally permissible DEX aggregator on neutral infrastructure. However, the token is rated Haram because its value accrual and staking subsidies are directly funded by non-compliant interest generated from the DAO's treasury deployments into DeFi lending protocols, following the discontinuation of its organic swap surplus revenue.

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Verdict by Activity

How you can hold and use 1INCH

Buy & Hold

Haram

The token's value accrual and staking subsidies are directly funded by non-compliant interest generated from the DAO's treasury deployments into DeFi lending protocols.

Unicorn Power Staking

Optional
Haram

Stakers receive a treasury-funded base APR subsidized by interest from DeFi lending protocols, alongside resolver execution profits.

Shariah Component Breakdown

Shariah Analysis

Infrastructure — where it runs

Passed

The asset operates on neutral, general-purpose blockchains including Ethereum, BNB Chain, Polygon, Arbitrum, Optimism, and Base.

Application — what it does

Caution

The core business of DEX aggregation is permissible, but there is peripheral Riba exposure as the DAO treasury actively deploys funds into interest-bearing DeFi lending protocols.

Asset — what you own

Caution

The token is used for governance and staking, but the staking yield is a mixed source that includes execution profits and treasury-funded subsidies derived from interest-bearing lending protocols.

Property Status (Māl)

Passed

The token is a native protocol position that presently exists on-chain with a fixed ascertainable supply, self-custody transferability, and established genuine lawful use in governance and staking.

Revenue Purity

Failed

The protocol's active revenue is entirely derived from interest-bearing DeFi lending protocols, and because this non-compliant revenue directly funds staking subsidies for token holders, it constitutes impure token-funding revenue exceeding the 33% threshold.

Legitimacy & Security

social presence

Passed

The project has massive adoption and integration, processing over $300 billion in cumulative volume.

project audits

Passed

Security information and audits are identified in the research.

whitepaper

Passed

Official documentation and tokenomics are available and identified in the research.

Team & Ecosystem

team background

Caution

Not covered by research.

Detailed Shariah Report

Overview

1inch is a decentralized exchange (DEX) aggregator that sources liquidity across various platforms to provide users with optimal trade prices and protection against maximal extractable value (MEV). The 1INCH token is the native governance and utility token of the protocol, representing a native protocol position rather than a redemption claim against an issuer, and allows holders to vote on DAO proposals or stake their tokens for Unicorn Power to earn yield.

Why This Verdict

The Shariah evaluation of 1INCH relies on a three-layer screen: the underlying infrastructure, the asset itself, and the application's revenue model; a failure at any one layer fails the whole asset. At the base layer, the token operates on neutral, general-purpose blockchains like Ethereum and BNB Chain, which is permissible as hosting other people's applications does not taint the native infrastructure. At the asset layer, the token qualifies as recognized digital property (Mal, or wealth) because it is an exclusive, protocol-recognized right of control that presently exists on-chain with a fixed ascertainable supply. It can be held and transferred via self-custody, carries established lawful use in governance, and is treated as wealth by a body of people. However, the asset fails at the application and revenue layer. Simply buying and holding the 1INCH token is rated Haram. Following the discontinuation of its organic swap surplus revenue in June 2023, 100% of the DAO's active revenue is now generated by deploying treasury funds into interest-bearing DeFi lending protocols like Aave and the Maker DAI Savings Rate. Because this non-compliant interest directly funds the token's value accrual and staking subsidies, the token's core financial model is fundamentally compromised by Riba (usury). Furthermore, regarding optional mechanisms, the opt-in Unicorn Power Staking program is also rated Haram. While stakers receive some permissible execution profits from network resolvers, they also receive a treasury-funded base APR that is directly subsidized by the aforementioned DeFi lending interest.

Permissible Aspects

  • The core business activity of DEX aggregation, which routes trades to find the best prices and protects against MEV, is a permissible utility.
  • The token operates on neutral, general-purpose blockchain infrastructure.
  • The token qualifies as recognized digital property with self-custody transferability and a fixed maximum supply.

Points of Caution

  • !The 1inch DAO treasury actively deploys its funds into conventional DeFi lending protocols (such as Aave V3 and the DAI Savings Rate) to earn interest, exposing the protocol to Riba.
  • !The protocol's organic revenue mechanism (Swap Surplus) was discontinued, leaving interest generation as the sole active revenue source for the DAO.
  • !The staking yield is a mixed source; while it includes permissible execution profits from Fusion resolvers, it is heavily subsidized by the treasury's interest-bearing activities.

Purification Note

Not applicable. Because the token's value accrual and staking subsidies are directly funded by non-compliant interest exceeding permissible thresholds, the asset is rated Haram for investment. Purification cannot legitimize holding an asset whose core economic model is fundamentally reliant on Riba.

BOTTOM LINE

While 1inch provides a highly useful and permissible DEX aggregation service on neutral infrastructure, the 1INCH token itself is rated Haram for investment. The protocol's active revenue is now entirely derived from interest-bearing DeFi lending, which directly funds the token's value accrual and staking rewards. Consequently, Muslim investors should avoid holding or staking 1INCH until its economic model shifts away from Riba-based treasury yields, noting that final religious authority rests with a qualified scholar.

How this verdict was reached

This is not an opinion issued by ShariaQuant. It is the output of a documented screening methodology applied to researched facts about 1INCH (1INCH), and every row above states the specific evidence that drove it — so the reasoning can be examined rather than taken on trust.

The framework screens three layers — the infrastructure an asset runs on, the application it serves, and the asset itself — and separately tests whether the token qualifies as recognised property (māl): that it presently exists, has an ascertainable supply, can be held and transferred, and carries a genuine lawful use. A failure at any single layer fails the asset.

Revenue-purity thresholds follow the AAOIFI screening standard: non-compliant income below 5% of revenue is tolerated and purified, while 5% or above fails the screen.

AAOIFI has not reviewed, approved or endorsed this report or ShariaQuant, and no scholar named in our methodology has reviewed this individual verdict. This is analysis, not a fatwa — final religious authority rests with a qualified scholar.