Pakistan fatwa declares cryptocurrency trading haram
Pakistan’s top Sunni scholar Mufti Muhammad Taqi Usmani has issued a fatwa declaring cryptocurrency trading impermissible under Shariah. He said cryptocurrencies, crypto tokens, and stablecoins do not qualify as “wealth” or “property” in Islamic law. The ruling covers major digital assets including Bitcoin (BTC), Ethereum (ETH), and Tether (USDT). Darul Uloom Karachi publicly released the decision and stated that terms such as “cryptocurrency”, “virtual currency”, “token”, and “stablecoin” all refer to the same category, so changing terminology does not change the ruling. The seminary added that several other scholars have endorsed the fatwa.
Although a fatwa is not legally binding, it can influence Muslim investors’ participation in crypto markets. The news comes as Pakistan moves in the opposite direction: the government is working to expand and regulate the digital-asset industry. The Pakistan Virtual Assets Regulatory Authority (PVARA) is tasked with licensing exchanges and building a regulatory framework for virtual assets, aimed at protecting investors from fraud while encouraging blockchain adoption.
After the fatwa, PVARA chairman Bilal Bin Saqib met Mufti Usmani to discuss digital assets from both technical and Shariah perspectives. However, the fatwa was not withdrawn or amended.
Neutral
A Shariah fatwa against cryptocurrency trading can create localized sentiment headwinds, especially among Shariah-compliant investors in Pakistan. In the short term, this may raise uncertainty, increase volatility, or reduce retail inflows from that community.
However, the market impact is likely limited because (1) fatwas are not legally binding, (2) Pakistan’s regulator (PVARA) is simultaneously moving toward licensing and frameworks for exchanges and virtual assets, and (3) the broader global crypto market often trades on liquidity, macro, and exchange flows more than on religious rulings.
Historically, regulatory or stance-related headlines tied to specific jurisdictions can briefly affect risk appetite for BTC/ETH, but sustained price trends usually require enforceable policy changes or major exchange/settlement restrictions. Here, the key development is coexistence of a religious prohibition with a parallel regulatory push—so the net effect for traders is more about managing headline risk than expecting a durable structural bearish shift.