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Influential Pakistani Scholar Issues Fatwa Declaring Cryptocurrency Haram

From Republika · () Indonesian

Translated from Indonesian, summarized and contextualized by DistantNews.

At a glance

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  • A prominent Pakistani Islamic scholar, Mufti Muhammad Taqi Usmani, has issued a new fatwa declaring cryptocurrency trading and investment as haram (forbidden) under Islamic law.
  • The fatwa states that cryptocurrencies, tokens, and stablecoins like USDT do not meet the criteria for 'wealth' or 'possession' in Islamic jurisprudence.
  • This ruling is expected to significantly impact Muslim investors in Pakistan and globally, reinforcing that changing an asset's name does not alter its religious status.

Cryptocurrency has long been a subject of debate within the Muslim community regarding its compliance with Islamic principles. Now, one of the most influential figures in Islamic finance, Mufti Muhammad Taqi Usmani, has definitively stated that trading and investing in digital currencies are forbidden.

cryptocurrency, crypto tokens based on blockchain, and stablecoins, including USDT, do not meet the criteria for 'wealth' or 'possession' according to the principles of Islamic fiqh.

— Mufti Muhammad Taqi UsmaniExplaining the reasoning behind the fatwa against cryptocurrencies.

Usmani, a highly respected scholar, issued a new fatwa declaring cryptocurrency transactions impermissible under Sharia law. This ruling, originating from Darul Ulum Karachi and disseminated by affiliated scholars, asserts that digital assets like Bitcoin, Ethereum, and even stablecoins such as USDT fail to meet the fundamental requirements of 'harta' (wealth) or 'milk' (possession) as defined in Islamic jurisprudence.

Therefore, buying, selling, trading, or investing in these digital assets is not permissible.

— Mufti Muhammad Taqi UsmaniStating the conclusion of the fatwa regarding cryptocurrency transactions.

Consequently, the fatwa concludes that the buying, selling, trading, or investing in these digital assets is not allowed. This prohibition extends beyond well-known cryptocurrencies to include blockchain-based tokens and stablecoins. The scholars emphasized that altering the terminology, whether termed cryptocurrency, virtual currency, token, or stablecoin, does not change the underlying religious ruling.

Changing the term or name of an asset does not change its legal status.

— Mufti Muhammad Taqi UsmaniClarifying that different names for digital assets do not exempt them from the ruling.
DistantNews Editorial

Originally published by Republika in Indonesian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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