Tether Gold Gets a Shariah Compliance Certification

Tether's gold-backed token XAU₮ received a Shariah compliance certification on Monday from Amanah Advisors, an Islamic finance advisory firm led by Mufti Faraz Adam. The firm said its review found the token's structure consistent with Islamic commercial law, a judgment Tether said opens the product to Islamic banks, institutions and individual savers who had no compliant route into digital gold. Each XAU₮ represents one troy fine ounce of gold held in Swiss vaults, issued by TG Commodities, S.A. de C.V. Tether named the Gulf Cooperation Council states, South Asia and parts of Africa as its target markets, along with Islamic finance desks in global financial centres. Two different measures of the product's size circulate, and they do not match.

The Review: Ownership, Reserves and the Absence of Riba

Shariah compliance, for an asset-backed token, is a judgment about structure rather than about price or performance. The questions a reviewer asks are who owns the underlying asset, whether that asset demonstrably exists, and whether the arrangement generates returns through practices Islamic commercial law prohibits — chief among them riba, the taking of interest. According to Amanah Advisors, the review covered XAU₮'s ownership model, the transparency of its reserves and the physical backing behind each unit, and confirmed the absence of riba, leverage and speculative derivatives. The distinction that carries the weight is between a token that conveys a claim on a specific quantity of metal and one that merely tracks a gold price; the firm's review, as described, addressed the first.

The Size: Two Figures for the Same Token

The reporting around the certification carried two different measures of how large XAU₮ has become, and they should be read as separate accounts rather than reconciled. crypto.news put the on-chain locked value at about $2.86 billion, up from roughly $826 million a year earlier — more than a tripling. FinanceFeeds cited more than 707,000 troy ounces of physical gold worth $3.3 billion as of 31 March, and gave the on-chain value as roughly $2.5 billion against about $700 million in July 2025. The two sets differ both in what they measure — vaulted metal at a quarter-end date versus tokens locked on-chain — and in the on-chain number itself, $2.86 billion against roughly $2.5 billion. What both agree on is direction: the token is several times the size it was twelve months earlier.

The Market: The Gulf, South Asia and a Growing Tokenized-Asset Field

Tether's stated reason for seeking the certification is distribution. Islamic banks and the Shariah-screened funds alongside them generally cannot hold an instrument their own boards have not cleared, which left a pool of capital without an obvious route into tokenized gold. That constraint is felt most acutely in exactly the markets Tether named, where demand for regulated, locally supervised tokens has been building through the year. The certification also arrives in a month when tokenized real-world assets — funds, treasuries and commodities issued as blockchain tokens — have been growing quickly across several chains. Paolo Ardoino, Tether's chief executive, framed the step in those terms: "Gold has always represented stability and trust across cultures and generations. With XAU₮ now recognized as Shariah compliant, we are expanding access to digital gold in a way that respects Islamic finance principles while leveraging the transparency and efficiency of blockchain technology."

What the Certificate Binds, and What It Does Not

A certification of this kind is an opinion issued by a named advisory firm and its scholar, and its authority travels with their standing rather than with any statute. It is not a licence, and no regulator issued it. Tether's release does not cite AAOIFI, the standard-setting body many Islamic financial institutions follow, or any other named standard against which the review was conducted, which leaves institutions comparing the opinion to their own criteria without a common reference point. In practice each bank's internal Shariah board still decides for itself whether to hold the token, and one firm's certificate does not oblige another's committee to agree. The open questions are practical: which institutions in the GCC and South Asia onboard the token, whether a recognized standard is later attached to the review, and whether the on-chain figure keeps climbing at last year's pace.