Oil pipe line valve in front of the Saudi Arabia flag on the oil barrels.
Getty
Wahed, the ethical investment fintech for Muslim investors, raised $25 million in venture funding with proceeds being funneled into ensuring people can invest their money into a diversified portfolio consisting of stocks, commodities, real estate and sukuk, the latter being Halal-focused asset ownership certificates.
Sharia law forbids those of Islamic faith from paying or earning interest and engaging in what could be considered as unethical investments. The world’s 1.8 billion Muslims have until recently been underserved by the financial institutions in Europe, and this is where online robo-advisors like Wahed come in.
Fintech players that do consider Sharia law ensure that customer assets will not be invested in usurious companies that deal with tobacco, alcohol, firearms, gambling or pornography, which can also align with ethical, social and governance (ESG) requirements.
Conventional finance has a problem with transparency and fairness. There are 1,407 Islamic financial institutions globally, from retail to investment banks and asset managers. The 2017 ICD-Reuters report put the Islamic finance industry at $2.2 trillion of assets in 2016 and forecast that it would grow to $3.8 trillion of assets by 2022.
The funding round led by Saudi Aramco Entrepreneurship Ventures, also known as Wa’ed Ventures, a venture capital investment arm of global petroleum and natural gas company and existing investors BECO and CueBall Capital, as well as Dubai Cultiv8 and Rasameel, is notable given the Covid-19 pandemic has destabilized private capital markets and decimated the fintech investment market.
But with ethical investment and Islamic finance growing in popularity and people taking an interest in securities that are in line with Islamic ethics, ensuring that usurious companies are not funded, Saudi Aramco were wise to invest in a fintech firm that has been dubbed the world’s first Islamic finance company.
“The Muslim investor has a specific requirement that prohibits them from keeping their excess savings in bank accounts,” said Junaid Wahedna, Group CEO of Wahed. “Banks utilize deposits to lend money for interest which is proven to increase inequality and cause an unfair advantage to the wealthier borrower, whilst charging a high interest fee for lower income consumers.”
Wahed has experienced incredible demand, not only in the MENA region but globally. With Saudi Arabia’s young population that are born digitally-savvy and practicing religion, the fintech organization have high hopes for development of the company’s subsidiary in this country in line with the KSA’s Vision 2030 that looks to be the investment powerhouse and thriving economy that connects three continents.
Since launching in 2017, Wahed was recently awarded the first RoboAdvisory permit by the financial regulator, the U.K.’s Capital Markets Authority (CMA), to launch its platform in KSA.
Tapping into the rising demand for Islamic and ethical investments, a sector that merges Sharia law and modern investment theory hasn’t hurt. Wahed have created an easy to use global platform, with free portfolio recommendation and no hidden fees, available through a mobile app and accessible in the U.S., U.K., and Malaysia.
Wassim Basrawi, Managing Director at Wa’ed Ventures, made the following statement: “We believe in Wahed’s mission to provide ethical investing. The company has taken the lead in delivering investment services to one of the world’s fastest growing sectors – Islamic finance.
“Wahed is also, in the true spirit of fintech, helping to broaden the investment landscape. This latest funding round will enable Wahed to make Saudi their regional MENA hub and contribute towards a fast-growing fintech ecosystem.”
Wahed’s foray into Malaysia in 2019 bolstered their global presence, and the fintech firm now serves over 100,000 clients globally, with growth plans for the largest Muslim markets including Indonesia, Nigeria, India and the CIS.
Wahedna believes that they are paving the way for ethical investment in Islamic finance and showing the world how underserved the Muslim market is. He adds that there is no doubt that Wahed’s growth will motivate local players to launch similar offerings. “We welcome efficiency in our industry as the end customer should always win without having to pay an unnecessary cost for investing in line with their ethics.”
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
