Trading tokens with returns

As-salāmu ‘alaykum Mufti Faraz Sb & IFG team.

I’m an Islamic Scholar working with some senior Muftiyān of UK. Here is a question, we needed a financial viewpoint on.

The questioner submitted as follows:
In the digital world, you buy and invest ‘electronic tokens’ in an Internet company that allows people to trade the market speculating on the value like share trading. This company also allows people to take out a loan (loaning electronic tokens). This company pays out a percentage back to people like me who bought their tokens (call it shares). The return is a percentage which varies and there is a small risk I could lose my money.

Q: can I give my tokens back to this company so they can lend it out and I get a varying return which can go up or down. This sounds like an interest loan return bit can also be considered as a dividend return you typically get back from say buying Amazon shares.
If you need further clarity pls let me know‘

Is it appropriate to assume that trading such tokens initially is fine (subject to usual screening) but as a loan, it may be problem

Any thoughts appreciated so we can discuss. If Mufti Faraz etc wish, they can contact us via whatsapp or email also, we can provide if needs be. JazakAllahu Khayran.

Wa alaykum salaam,

We pray you are well.

There would need to be a screening of this type of token and the essence of the contractual relationships between all before giving any definitive guidance or answer.

You are welcome to state more specifics of the token in your reply.

Allah knows best

Agreed. That makes sense Shaykh. Is there any specific questions you have in mind that we can ask the questioner in order to determine a ruling thereafter? BarakAllahu Feekum.

Assalaamu alaykum,

You would need to ask the name of token so you can review it thoroughly to understand the full nature of the investment and mechanics of the product.