Stellar Lumens [XLM] has been doing pretty well in the market since the announcement of its potential listing on Coinbase. On 17th July, Stellar announced that it is the first DLT [Distributed Ledger Technology] to receive the Sharia Certification for its payments and asset tokenization.
Stellar’s official account tweeted:
“Stellar is the first distributed ledger protocol to receive Sharia compliance certification in the money transfer and asset tokenization space.”
67aiga7a, a Twitterati commented:
“W** is sharia compliance? If you send tokens to an infidel the Stellar team stones you to death?”
XXIII, another Twitter user said:
“It’s crazy how many people don’t understand what Sharia compliance is and it’s place in modern finance”
The Stellar Development Foundation’s founding mission is to advance global monetary access and consideration. By building public, open-source programming, Stellar expects to empower foundations to give solid and ease budgetary innovations to serve all topographies, ethnicities, work-classes, and religions.
Stellar announced to propel their main goal of monetary access and consideration by being rewarded by a Sharia compliance certification for the Stellar technology and network.
The ‘Shariyah Review Board’ [SRB], a global Sharia advisory organization authorized by the Central Bank of Bahrain, has surveyed the properties and utilization of Stellar. SRB has further proclaimed direction and rules 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. Additionally, the Sharia compliance certification extends to applications and usages of Stellar Lumens [XLM].
In association with SRB, this accreditation will help the development of Stellar’s ecosystem in regions where monetary administrations require to be compliant with Islamic financing standards. For example, Islamic budgetary foundations in the Gulf Collaboration Council such as Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, UAE.
Even the regions of Southeast Asia, like Indonesia and Malaysia, will now have the capacity to incorporate Stellar innovation in their Sharia-consistent item and administration contributions.
This is a major progression for the Stellar system given that these areas are prominent hubs of business.
Sharia has over 10 principles on trading assets on Stellar, such as:
- The subject of sale must be existing at the time of sale.
- The subject of sale must be in the ownership of the seller at the time of sale.
- The subject of sale must be in the physical or constructive possession of the seller when he sells it to another person.
- The sale must be instant and absolute.
- The subject of sale must be a property of value.
- The subject of sale should not be a thing which is not used except for a haram purpose, like pork, wine, etc.
- The subject of sale must be specifically known and identified to the buyer.
- The delivery of the sold commodity to the buyer must be certain and should not depend on a contingency or chance.
- The certainty of price is a necessary condition for the validity of a sale. If the price is uncertain, the sale is void.
- The sale must be unconditional. A conditional sale is invalid unless the condition is recognized as a part of the transaction according to the usage of trade.
In the following months, individuals from the Stellar Development Foundation will meet with global financial institutions. The groups will connect and bring in the best ways to use Stellar in their Sharia-agreeable monetary administrations.
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