How Swap-Free Trading Accounts Work in Forex and Crypto

Swap-free accounts (often called Islamic) are a type of trading account where the broker does not charge swaps for rolling a position over to the next day. Such accounts were originally developed for Muslim traders, as receiving or paying interest is contrary to Sharia law and is considered haram. Today, such accounts are also available to other traders who want to avoid swaps. Let’s look at how such accounts work in the Forex and cryptocurrency markets, compare them with regular accounts, and find out whether trading through them is considered halal.

The Role of Swaps in Trading

Swap is a fee for carrying an open position overnight. In the Forex market, a swap reflects the difference in interest rates of two currencies in a pair: for each day of holding a position, the trader either receives or pays a certain amount. In a classic account, these charges occur automatically.

In crypto trading, there are no swaps when buying or selling assets on a spot (non-leveraged) basis, as there is a direct exchange without a loan. However, when trading with leverage or derivatives, similar interest costs arise. For example, on crypto exchanges, perpetual futures are accompanied by regular payments (funding fees), essentially identical to a swap. From a Sharia perspective, such payments are unacceptable, so a special trading format is required for Islamic clients that excludes these elements. In this regard, the question often arises: Is forex trading halal or haram? The answer depends on the terms of trade and the compliance of the transaction with Islamic principles.

How Swap-Free Accounts Work

A swap-free account allows you to trade without being charged interest for rolling over a position. The broker either eliminates the overnight commission or replaces it with an alternative compensation model that is not related to interest rates. The goal is to provide the same trading opportunities without the usury element.

On Forex. Many brokers offer swap-free accounts on the currency market, especially for clients from Islamic countries. The principle is simple: swaps on open positions are not charged at all, which makes it possible to hold transactions for as long as you want without violating the prohibitions. To compensate for the missing income, brokers use different approaches. Some charge a fixed commission for transferring a position (it is known in advance and does not depend on rates). 

Others impose a time limit: for example, the Pepperstone account does not charge swap for the first 5 days, and after this period, it writes off a one-time fee of about 100 USD per lot. Some brokers increase the spread on the Islamic account, including the commission cost of transactions. 

It is important to study the terms of the specific company, as the details vary. The best brokers provide interest-free trading without restrictions, but most impose some kind of commission or limit. For example, several brokers automatically close positions on an Islamic account when the limit of days is reached or begin charging an administrative fee. Within the permitted period, trading is no different from a standard account, except for the absence of swaps.

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In crypto trading. In the cryptocurrency market, the Islamic approach usually comes down to banning interest by limiting the types of transactions. As a rule, an Islamic account on the exchange allows only spot trading (without leverage) and disables margin transactions. Thus, in 2024, the Bybit exchange launched the first Islamic accounts offering Muslim clients only spot transactions with selected “halal” cryptocurrencies. There are no interest charges or swaps in such an account. 

Many Forex brokers do not extend the interest-free regime to crypto and stock CFDs – standard swaps continue to be charged. Accordingly, Muslim traders should avoid these instruments or use specialized platforms where trading is organized without interest. 

Comparison of swap-free and regular accounts

Swaps and fees. Regular accounts charge a swap (interest payment at market rates) when positions rollover. Islamic accounts don’t charge swaps— they may charge a fixed fee or a larger spread. For instance, rather than daily interest, they might charge a one-time fee after holding a position for five days.

Available instruments. The swap-free regime usually covers noticeable currency pairs and commodities. CFDs on shares, indices, or cryptocurrencies are often excluded from the swap-free conditions or have separate rules. In a standard account, the client is free to trade all instruments, but the corresponding swaps will be charged for each.

Position holding. An Islamic account may limit how long traders can hold a position continuously (for example, 7–14 days) without paying an additional commission. Once traders exceed this limit, the broker charges a fee or closes the position. A standard account doesn’t have such limits: traders can hold a position as long as they like, but the broker charges a daily swap.

(Connection of the swap-free mode usually occurs upon request. Some brokers require confirmation of Islamic faith or limit the service for residents of certain countries, but there are companies where anyone can open a swap-free account.)

Forex and Crypto: Halal or Haram?

Islamic scholars have different attitudes towards speculative trading. Some consider classic forex trading and margin trading of cryptocurrencies to be prohibited (haram) due to the presence of interest and gambling elements. While others allow trading provided that the prohibited components are eliminated. The main principle is to avoid rib since making a profit through interest is strictly prohibited. In this regard, Islamic accounts solve the key problem by eliminating swaps from the equation.

However, the issue of gambling remains. If a trader treats the market like a casino, Islamic scholars equate that behavior with maysir (gambling) and excessive gharar (uncertainty), and they condemn it. To consider trading halal, a Muslim must approach it responsibly—relying on analysis, following risk management principles, and making real purchase and sale transactions instead of betting on luck. If traders meet these conditions, they can consider speculative trading in currencies or crypto assets acceptable. 

The modern financial industry is taking steps to comply with Islamic norms. Some countries have issued official clarifications: for example, the Shariah Council of Malaysia in 2020 recognized cryptocurrency trading and investments in digital assets as not contrary to Sharia. Large players are also adapting: major platforms like Bybit are launching Islamic accounts, confirming that, with the right service structure, trading can meet religious requirements. Thus, the answer to the question of “halal or haram” depends on whether the parties involved follow the principles of Islamic finance in a particular transaction.  

Conclusion

Swap-free accounts have become a vital tool for trading on global markets without interest. They allow Muslim traders to work with currencies and crypto assets without violating religious prohibitions. In terms of key trading parameters (spreads, order execution, leverage), the conditions on such accounts are comparable to regular ones, and the differences are only in the absence of swaps and related alternative commissions or restrictions.

The industry continues to develop halal services, with more and more brokers and exchanges introducing Islamic accounts and obtaining Shariah compliance certificates. The main thing for a trader is to carefully study the terms of a specific account so that fees and restrictions are transparent and fair. When traders meet these conditions, an Islamic account enables them to engage in full-fledged trading that combines financial rationality with spiritual principles. This practice has opened access to financial markets for millions of Muslim investors globally.