Stellar is one of the cryptocurrency firms targeting the financial sector. Many people see it as a major competitor to Ripple. The firm has now received its Islamic finance certification, which is a big step forward on the road to sharia-compliance for financial products.
Stellar Becomes Sharia-Compliant
The Islamic finance sector is of great importance to any service providers. Despite its strict rules and requirements. adhering to Islamic finance guidelines is not all that easy. Companies need to put in a fair amount of effort to be compliant. For entities active in cryptocurrency and blockchain, those challenges may prove to be rather steep.
For Stellar, receiving their Sharia compliance certification is a big step forward. It allows the company to expand its presence across the Middle East and Southeast Asia. This certificate spans Stellar’s blockchain and its native Lumens (XLM) currency. Without sharia compliance, forging partnerships with companies in the Gulf region is virtually impossible. This is despite the benefits Stellar can offer in terms of remittance and money transfers.
The blockchain firm is mainly interested in a few key nations. This list includes the UAE, Saudi Arabia, and Bahrain. All three countries are home to a major market for remittances and money transfer services. Stellar’s technology can also be used in other industries and business models. Digitization of assets is another option the company is exploring at this time.
Stellar’s Next Move Will Be Crucial
Together with IBM, Stellar is working on an asset digitization application. Whether or not it will make its way to the Gulf region remains unclear. This new license will give the company a wide range of options to explore in the near future. All companies in the cryptocurrency space need to keep evolving at all times. Exploring new critical markets plays an integral role in that ongoing process.
Bahrain is quickly positioning itself as an open-minded nation when it comes to cryptocurrencies. The country’s regulators seek to explore the use of digital currencies. This is part of a bigger plan to become a regional financial hub in the coming years. Stellar’s officials have been in talks with Bahrain’s Economic Development Board for some time now. This can lead to new business use cases to explore in the coming years.
Competition in the blockchain space is heating up. Saudi Arabia has shown an interest in Ripple’s technology for domestic and international payments. Stellar is now focusing its attention on the exact same regions in quick succession. Competition is beneficial to consumers and corporations alike. Gaining traction in these critical regions paves the way for broader blockchain and cryptocurrency adoption.
What do you think about Stellar receiving sharia compliance? Let us know in the comments below.
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