The crowdfunding contract is based on raising liquidity from the general public through the website of a professional intermediary.Due to governments’ concerns about providing small and medium-sized enterprises with fair and democratic access to this method of financing,as well as the need to preserve economic public order, comprehensive regulatory frameworks have been adopted by governmental regulatory authorities in Iran, the EU,and USA.In the two commercial models of crowdfunding, namely lending-based crowdfunding and equity crowdfunding, debt securities and shares,respectively, are issued.In Iran, due to the Sharia and legal prohibition of usury(riba) the issuance of conventional bonds is not permissible. With regard to equity crowdfunding, the regulations of the Iranian regulatory authority have, in practice, not permitted this form of crowdfunding and have instead allowed crowdfunding only in the form of participation in profits and losses.Under the regulations of the Iranian regulatory authority, an instrument known as the Crowdfunding Partnership Certificate is required to be issued. Nevertheless, inappropriate interpretations have been offered regarding the legal nature of this instrument, largely because of the insistence on characterizing it within the framework of traditional legal institutions.Consequently, recognition of the crowdfunding contract as a newly developed and sui generis contractual arrangement, and, accordingly, an analysis of the actual legal nature of the certificate, have been largely overlooked.Although the Crowdfunding Partnership Certificate constitutes a security, it cannot be fully characterized as an equity security, a debt security, or an Islamic financial instrument (sukuk).Rather, it possesses a distinct legal nature and specific legal effects of its own.