Today, Stellar announced it has obtained a Sharia compliance certification for the Stellar technology and network. The Shariyah Review Board (SRB), a leading international Sharia advisory agency licensed by the Central Bank of Bahrain, has reviewed the properties and applications of Stellar and has published guidance and guidelines that enable Sharia-compliant applications of Stellar technology in Islamic financial institutions.
Stellar is the first distributed ledger protocol to receive Sharia compliance certification in the money transfer and asset tokenization space. Also, the Sharia compliance certification extends to applications and usages of lumens (XLM).
The Stellar team said:
“The Stellar Development Foundation’s founding mission is to promote global financial access and inclusion. By building public, open-source software, we aim to enable institutions to provide reliable and low-cost financial technologies to serve all geographies, ethnicities, wealth classes and religions.”
What does this certification mean for the Stellar ecosystem?
In partnership with SRB, this certification will help grow the Stellar ecosystem in regions where financial services require compliance with Islamic financing principles. For example, Islamic financial institutions in the Gulf Collaboration Council (i.e. Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, UAE) and parts of Southeast Asia (e.g. Indonesia and Malaysia) will now be able to integrate Stellar technology in their Sharia-compliant product and service offerings.
This new is big progress for the Stellar network given that these regions comprise popular foreign worker remittance corridors. In the next few months, members of the Stellar Development Foundation plan to meet with global financial institutions and engage them on how to best utilize Stellar in their Sharia-compliant financial services and products.