Tether’s gold-backed digital asset, XAU₮, has received Shariah certification, a move that could open the door to one of the world’s largest and fastest-growing financial sectors.
Each XAU₮ token represents one troy ounce of physical, LBMA-certified gold stored in Swiss vaults. The token is issued by TG Commodities Limited and trades as an ERC-20 token on Ethereum, making it accessible across major crypto platforms including Swyftx and Blockchain.com.
What Shariah compliance actually means here
Islamic finance prohibits interest (riba), excessive uncertainty (gharar), and speculation (maysir). For a digital asset to qualify as Shariah-compliant, it needs to be backed by a real, tangible asset and structured in a way that avoids these red lines.
Major Shariah screening services Sharlife and CoinStudy have classified XAU₮ as halal, with CoinStudy assigning it a score of 81 out of 100. Halalscreener, another compliance evaluator, rates XAU₮ as “Doubtful” with a score of 50 out of 100 under AAOIFI criteria as of late July 2026. The concerns appear to center on issuer-level and operational elements rather than the underlying gold itself.
Abu Dhabi rolls out the regulatory carpet
On July 24, 2026, the Abu Dhabi Global Market (ADGM) recognized XAU₮ as an Accepted Spot Commodity. This designation allows authorized firms operating within ADGM to offer services related to the token, effectively legitimizing its use in one of the Middle East’s most important financial hubs.
Tether has been laying the groundwork for this moment through a series of strategic moves earlier in 2026. In February, the company announced a $150 million investment in Gold.com, a platform focused on gold distribution. As part of that deal, Gold.com planned to allocate $20 million toward XAU₮.
Then in April, Tether partnered with Fasset to launch a gold-backed Visa neobanking card specifically aimed at Islamic finance audiences. The partnership also includes planned Shariah-compliant yield products built around XAU₮, with Tether allocating up to $1 million in tokens for user rewards.
What this means for investors
XAU₮ isn’t the only tokenized gold product on the market. Paxos Gold (PAXG) is the other major player in the space, and as of now, it hasn’t pursued the same Shariah certification strategy.
Halalscreener’s “Doubtful” rating appears to focus on issuer-level factors rather than the gold backing itself. There’s also the question of whether Shariah-compliant yield products, as planned through the Fasset partnership, can genuinely avoid the pitfalls that make conventional yield instruments non-compliant. Regulatory experts have already flagged concerns about whether these offerings will hold up under scrutiny.