Tether Gold expanded its reach by securing Shariah compliance for its gold-backed token XAU₮, positioning it for broader use within Islamic financial sectors. The certification was granted by Amanah Advisors, a noted global Islamic finance consultancy led by Mufti Faraz Adam.
The advisory firm conducted a thorough review of XAU₮’s structure, examining its ownership model, transparency of reserves, physical gold backing, and adherence to Islamic finance rules. Key focus areas included the avoidance of interest (riba), use, or speculative derivatives all prohibited under Shariah law. The certification confirms that XAU₮ offers clear ownership of a tangible asset without involving interest, fulfilling essential Islamic finance criteria.
Gold-backed token set for new markets
Each XAU₮ token corresponds to ownership of one troy fine ounce of London Good Delivery gold stored securely in Swiss vaults. The token’s locked value has surged over the past year, now exceeding $2.86 billion. This milestone follows its recent acceptance as an Accepted Spot Commodity in Abu Dhabi, a significant regulatory endorsement in the Middle East.
With Shariah certification, XAU₮ can now enter a variety of Islamic finance products like halal savings accounts, institutional gold portfolios, takaful (Islamic insurance), trade finance, and collateralized lending. Islamic finance demands transactions be tied to identifiable assets and exclude elements like excessive uncertainty or gambling, making XAU₮’s direct link to physical bullion an attractive solution for blockchain-based gold exposure.
Tether CEO Paolo Ardoino described the approval as a bridge connecting gold’s historic role as a store of value with modern blockchain finance. He highlighted how the certification could unlock digital gold access for Islamic financial institutions across the Gulf Cooperation Council, South Asia, Africa, and other regions with strong Muslim populations and gold demand.
