In a significant development within the cryptocurrency industry, Tether‘s gold-backed token, XAUt, has achieved Shariah certification. This approval, granted by Amanah Advisors, now allows XAUt to cater to Islamic financial markets, providing a new, compliant avenue for investors seeking exposure to physical gold. The strategic move positions Tether’s XAUt as a viable asset for Islamic institutions aiming for Shariah-approved investment opportunities.
What Makes XAUt Shariah-Compliant?
XAUt’s compliance with Shariah principles lies in its foundational structure. The token is completely backed by allocated physical gold, eliminating interest and leverage, and ensuring transparency in its reserves. These factors align closely with the core principles of Islamic finance. For every XAUt token, there is one troy ounce of physical gold securely held in Switzerland, which meets Islamic requirements for tangible asset ownership.
How Will Certification Impact Market Reach?
The Shariah certification is expected to expand XAUt’s market reach significantly. It opens a gateway for Tether to engage more actively with Islamic financial institutions and cater to regions with a strong presence in Islamic finance, such as the Gulf Cooperation Council, South Asia, and parts of Africa. Tether projects this development will lead to increased adoption of XAUt in these regions, aligning with the Islamic financial ecosystem.
Tether’s XAUt stands out as one of the most significant tokenized gold products in the cryptocurrency sector. A recent reserves report highlights that as of March 31, XAUt is backed by more than 707,000 troy ounces of physical gold, valued at over $3.3 billion, reflecting its substantial market presence.
Blockchain analytics from RWA.xyz revealed a dramatic rise in XAUt’s onchain asset value, from about $700 million in July 2025 to $2.5 billion, showcasing strong growth in user interest for tokenized gold assets.
- Amanah Advisors certify XAUt for Shariah compliance, boosting its appeal in Islamic finance.
- XAUt is entirely backed by physical gold, emphasizing transparency and adherence to Islamic finance principles.
- Major geographical focus includes regions with strong Islamic finance markets.
Interest in aligning digital assets with Shariah laws is rising, as evidenced by further innovations in the Islamic financial sector. Recently, Bahrain’s AlAbraaj Restaurants Group initiated a Bitcoin treasury strategy, aiming to offer Shariah-compliant crypto instruments. Such moves illustrate the burgeoning demand for digital assets that comply with Islamic principles.
Dubai has cemented its role as a key player in the digital asset landscape of the Middle East. By achieving 50 licenses for virtual asset service providers through its Virtual Assets Regulatory Authority, Dubai has positioned itself ahead of other major crypto hubs, signaling a thriving regulatory environment for cryptocurrencies in the region.
