Pakistan's most prominent Islamic cleric, Mufti Muhammad Taqi Usmani, has issued a fatwa (religious ruling) declaring cryptocurrency trading as 'haram' (forbidden under Islamic law). The ruling was made public on 11 July 2026 by the Darul Uloom Karachi, one of Pakistan's most respected Sunni Islamic seminaries.
Fatwa Details and Reasoning
The fatwa was issued by Mufti Taqi Usmani, a renowned Islamic scholar and former judge of the Federal Shariat Court of Pakistan. According to the Darul Uloom Karachi, the ruling classifies cryptocurrency trading as impermissible due to its speculative nature and lack of intrinsic value, which contravenes Islamic financial principles. The seminary stated that the fatwa aims to guide Muslims in Pakistan and beyond on matters of digital asset trading.
Impact on Pakistan's Crypto Market
Pakistan has a growing cryptocurrency user base, with estimates suggesting over 15 million people engaged in digital asset trading. The fatwa is expected to influence many devout Muslims to reconsider their involvement in crypto markets. However, the ruling is non-binding and carries religious authority rather than legal enforcement. The State Bank of Pakistan and the Securities and Exchange Commission of Pakistan have yet to formally regulate cryptocurrencies, leaving a legal gray area.
Broader Context of Islamic Finance
Islamic finance prohibits 'riba' (interest) and 'gharar' (excessive uncertainty). Cryptocurrencies have been debated among scholars globally, with some deeming them permissible if tied to tangible assets. Mufti Taqi Usmani's fatwa aligns with conservative interpretations that reject digital currencies as speculative instruments.
The Darul Uloom Karachi emphasized that the ruling applies to all forms of cryptocurrency trading, including Bitcoin, Ethereum, and others. The fatwa is based on the principle that such transactions lack the stability and backing required under Sharia law.
Reactions and Future Outlook
Industry observers note that the fatwa may slow adoption but unlikely to eliminate crypto trading entirely in Pakistan. Some crypto exchanges have already responded by offering Sharia-compliant tokens. The ruling adds to global regulatory uncertainties surrounding digital assets.
