The strict rules make it difficult for many of the financial institutions to comply. A lot of changes are required for traditional banks and other financial institutions to become Sharia compliant. For blockchain companies and cryptocurrencies, it is a tough ask. However, Stellar has shattered the glass ceiling. With a Sharia compliance certification in place, Stellar will find it easy to gain inroads into the Middle-east and Southeast Asia.
The certificate covers Stellar’s blockchain and its native currency Lumens (XLM). Without Sharia compliance, it is practically impossible for to enter into a partnership with companies in the Middle-east, despite the benefits that Stellar offers in terms of transaction time and costs.
Stellar, at this point in time, is focusing on a handful of nations in the Middle-east. This includes the UAE, Saudi Arabia, and Bahrain. Millions of people from other nations, particularly India, Bangladesh, Pakistan, Phillipines, and Indonesia are working there. So, it is a hotbed for remittances and money transfer services. Furthermore, Stellar’s technology can also be used by other industries.
Asset digitization is another important option being explored by the Stellar team. In this regard, Stellar is working with IBM on an asset digitization application. However, Stellar has not clarified whether the app will make it to the Gulf region. Bahrain is trying to position itself as a major centre for blockchain related projects. Stellar’s executives are in talks with Bahrain’s Economic Development Board and investors are hopeful of a plenty of successful business cases in the future.
Notably, the Central bank of Saudi Arabia has entered into an agreement with Ripple (XRP) to test the latter’s money transfer platform. The entry of Stellar is expected to further intensify the competition to garner market share in the region. This is good from customer’s point of view as competition will pave way for cost reduction and increase in quality of service. Furthermore, it will also encourage more banks and financial institutions to use the service, leading to an increased pace of adoption of blockchain technology.