It would be good if someone can enlighten me on this subject of leverage trading on bybit exchange Is it Halal or Haram ?
After a conversation with support team on Bybit they claim they don’t charge interest at all on their exchange for leverage trading however they do charge a funding fee which weather you are in a leverage trade or cash trade you have to pay it if you are in a open trade and the fees does not go to Bybit.
The funding fee is not only for leverage trading but anyone who is in a open trade weather buying or selling so if the funding fee is haram then I guess trading on by bit will be also.
A previous Question was asked regarding this topic and a long discussion was held with no conclusion on it.
It would be so helpful for me to get answer regarding this Please.
for anyone wanting to read about this topic They explain about their fees on their website on this link below :
Wa alaykum salaam,
The funding fee is not Shariah compliant. There is no such concept where a buyer will pay a fee to the seller in one scenario, and in the reverse, the seller pay a fee to the buyer. The gain in a trade is from the sale. Any other conditional obligation in this manner is Gharar, and not compliant.
The funding fee is exchanged directly between buyers and sellers at the end of every funding interval*. Using an 8 hour funding time interval as example funding will occur at 16:00 UTC, 00:00 UTC and 08:00 UTC.
When the funding rate is positive, long position holders pay the short position holders. Likewise, when the funding rate is negative, short position holders pay the long position holders.
Traders will only pay or receive funding fee if they hold a position at one of these times.
If positions are entirely closed prior to the funding exchange then traders will not pay or receive funding fee.
Allah knows best
what about bitmex quarterly futures? theres no funding or interest at all, only payment is the standard taker and maker fees. is this permissible?
also what about short term trades within funding windows so we avoid funding, is that also permissible?
the way bitmex does it, there is no lending money, and there is no unlimited risk, you can only lose what you put in. i dont see where the haram could be.
ive been trying to get a solid answer on this for over 3 years wallah. the state of this ummah is so embarrassing. ive gone to so many sites, tried to ask questions to so many scholars. 90% say they dont have the knowledge on islamic finance. and the ones that do never answer my questions. even the one i have paid directly to ask this question didnt give me a clear answer.
Mufti, you said in your post the problem was the funding. there are many scenarios where there will be no funding payment.
- as you said, positions can be closed before the funding period as they are at set periods every 8 hours.
- the quarterly futures, rather than the perpetual contracts, dont have any funding payment at all.
in these 2 scenarios, is it permissible to trade on these platforms since there is no lending, no interest, no funding fee?