Influential Pakistani Scholar Issues Fatwa Declaring Cryptocurrency Haram

For years, Muslims have debated whether cryptocurrency is compatible with Islamic law or the opposite. Now, one of the most influential figures in Islamic finance, Mufti Muhammad Taqi Usmani, has spoken out, stating that trading and investing in cryptocurrency is not permissible under syariah.

Usmani has issued a new fatwa stating that cryptocurrency trading and investment is haram under Islamic law. The fatwa is expected to have a significant impact on Muslim investors in Pakistan and various other countries.

The fatwa, issued under the supervision of Darul Ulum Karachi and disseminated by ulama affiliated with the institution, states that cryptocurrency, blockchain-based crypto tokens, and stablecoins, including USDT, do not meet the criteria of ‘asset’ or ‘ownership’ under the principles of Islamic fiqh.

Because they do not meet these basic syariah requirements, the fatwa concludes that buying, selling, trading, or investing in these digital assets is not permissible.

The ruling applies not only to widely known cryptocurrencies such as Bitcoin and Ethereum, but also to crypto tokens issued through blockchains and stablecoins.

The fatwa also affirms that changing the term or name of an asset does not change its legal status. Whether called cryptocurrency, virtual currency, token, or stablecoin, all are treated the same under the fatwa.