Key Takeaways
- Mufti Muhammad Taqi Usmani, Pakistan's top Islamic scholar, has declared cryptocurrency trading impermissible under Islamic law.
- The fatwa covers cryptocurrencies, crypto tokens, and stablecoins, stating they do not meet the definition of wealth or property.
- While non-binding, the ruling may significantly influence how many Muslims approach cryptocurrency investment.
Pakistan's leading Islamic scholar, Mufti Muhammad Taqi Usmani, has issued a new religious ruling (fatwa) declaring cryptocurrency trading impermissible under Islamic law. The fatwa was shared online by scholars affiliated with Darul Uloom Karachi and was issued in June 2026.
According to the announcement, the ruling covers cryptocurrencies, crypto tokens, and stablecoins. Mufti Usmani's statement explicitly states that 'cryptocurrency is not considered wealth,' whether it is a crypto token or a stablecoin such as USDT. This means that buying and selling these digital assets is deemed impermissible under Islamic law.
The fatwa further explains that different names, including cryptocurrency, virtual currency, token, and stablecoin, all refer to the same category of digital assets. Therefore, the ruling applies equally to all forms of these assets. The announcement clarifies that simply changing the terminology does not alter the religious ruling. Mufti Usmani's statement reads: 'Cryptocurrency is known by different names, including virtual currency, token, and stablecoin. In all these forms, cryptocurrency is not considered wealth, and therefore it is not permissible.'
While this fatwa represents a religious opinion rather than a state law, it may significantly influence how many Muslims view cryptocurrency trading and investment. The announcement notes that the fatwa was issued under the supervision of Darul Uloom Karachi and carries endorsements from several religious scholars.
The implications of this ruling extend beyond just religious considerations. It could impact the adoption and usage of cryptocurrencies among Pakistan's large Muslim population, who make up around 96% of the country’s total population. This decision may also affect the broader financial ecosystem in Pakistan, influencing regulatory discussions and public perception.
While the fatwa is non-binding, it carries significant weight within the Islamic community. Many Muslims follow such rulings when making financial decisions. The announcement further states that this ruling applies to blockchain-based tokens and stablecoins like USDT, indicating a comprehensive approach to digital assets.
The fatwa's issuance comes at a time when Pakistan is increasingly engaging with digital currencies. With the rise of blockchain technology and its applications in various sectors, such as finance and supply chain management, this religious opinion could have far-reaching consequences for both individuals and businesses operating within the country.
