Is Crypto Haram? What Mufti Taqi Usmani's Fatwa Says

Is Crypto Haram? What Mufti Taqi Usmani's Fatwa Says

A major religious ruling has added a new dimension to Pakistan's fast-growing cryptocurrency debate. Mufti Muhammad Taqi Usmani, one of the most respected Islamic finance scholars in the world, has issued a fatwa declaring that buying and selling cryptocurrency is impermissible under Islamic law.

For a country with millions of crypto users and a government actively working to regulate digital assets, this is a significant development. It raises real questions for Muslims who own or trade crypto. This article explains exactly what the fatwa says, the reasoning behind it, and what it means, while noting fairly that scholars around the world have not reached agreement on this issue. Our aim is to inform, not to issue any religious judgment.

What the Fatwa Says

The ruling is clear in its conclusion. Mufti Muhammad Taqi Usmani, president of Wifaq-ul-Madaris Al-Arabia Pakistan and Darul Uloom Karachi, issued a fatwa stating that the buying and selling of cryptocurrencies is not permissible under Islamic Shariah. It was issued in June 2026 and shared by scholars affiliated with Darul Uloom Karachi.

The ruling is broad in scope. According to the announcement, the ruling covers cryptocurrencies, crypto tokens, and stablecoins. It applies not just to well-known coins like Bitcoin and Ethereum, but also to stablecoins such as USDT (Tether).

The fatwa also closes a potential loophole around naming. It explains that different terms, such as virtual currency, token, or stablecoin, all describe the same category of digital assets, so the same ruling applies to all of them. In the scholars' words, altering terminology does not alter the religious ruling.

The authenticity has been confirmed. His son, Hassan Usmani, confirmed that the fatwa circulating on social media was authentic and had indeed been issued by his father.

The Reasoning: The Concept of "Maal"

To understand the ruling, you need to understand one key Islamic concept: maal. The fatwa's entire argument rests on it.

In Islamic jurisprudence, for something to be validly bought, sold, or used as money, it must qualify as maal, meaning property or wealth that has recognized, tangible value. The fatwa concludes that cryptocurrency does not meet this standard.

The ruling describes crypto in specific terms. According to the fatwa, cryptocurrency does not qualify as maal (property or wealth) under Islamic law but is merely a record of notional numbers in an account. Because it is seen as not fulfilling the conditions for real wealth or ownership under Shariah, the fatwa concludes that transactions involving it cannot be considered valid.

The ruling was notably issued in response to a real question. It came after a person asked whether books and an online course they had purchased using cryptocurrency, including a USDT transaction, were valid under Islamic law. The fatwa advised that such purchases were impermissible.

Important: This Is a Religious Opinion, Not Law

A crucial point that must be understood clearly: a fatwa is a religious opinion, not a legal command from the state.

The ruling is not enforceable as state law. While the ruling represents a purely religious viewpoint, it cannot be legally enforced. Cryptocurrency is not banned in Pakistan because of this fatwa. The government's own regulatory process continues separately.

However, its influence is real. In a country where religious rulings carry significant social weight, and coming from a scholar as respected as Mufti Taqi Usmani, the fatwa will be taken seriously by a large segment of the population. For many Muslims, it becomes a matter of personal conscience and religious practice.

The Scholarly Debate Is Not Settled

Here is an essential piece of context that responsible coverage must include: the global Islamic scholarly community has not reached consensus on cryptocurrency.

Mufti Taqi Usmani's view is highly influential, but it is not the only respected position. The debate within Islamic finance circles over cryptocurrency has been active and unresolved for years. Different authoritative institutions and scholars have reached different conclusions.

For example, some Islamic legal bodies have ruled against crypto citing speculation and lack of intrinsic value, while other Muslim-majority countries with serious Islamic finance traditions, such as the UAE, have taken a more open regulatory and religious approach. The core challenge is genuinely difficult: applying centuries-old Shariah principles to an asset class that did not exist when those principles were written. Sincere, learned scholars have landed on different answers.

This does not diminish the fatwa's importance. It simply means it is one major, respected voice in an ongoing global conversation, not the final word for all Muslims everywhere.

Industry Impact: Why the Timing Matters

The fatwa arrives at a delicate moment for Pakistan's crypto landscape.

For crypto users, the numbers are large. Pakistan has an estimated nine million crypto users, among the largest crypto-adopting populations in the world. For many of them, this fatwa creates a genuine religious question to weigh personally.

For the government, the timing is challenging. Pakistan is in the process of designing its first cryptocurrency taxation framework for Finance Bill 2026-27, aiming to bring crypto users into the formal tax and documentation system. A major fatwa declaring crypto impermissible complicates efforts to formalize and grow the sector.

For the broader crypto policy, it sits in tension with recent moves. Pakistan recently established the Pakistan Virtual Assets Regulatory Authority (PVARA) and saw global exchanges like Binance engage with local partners. The country chose to regulate rather than ban crypto, so a prominent religious ruling against it adds a new layer to the national debate.

Expert Insight: A Question of Conscience and Policy

The fatwa highlights a deeper reality: Pakistan is navigating the intersection of faith, finance, and fast-moving technology, all at once.

For individuals, the practical effect is personal. Those who follow Mufti Taqi Usmani's rulings closely may choose to avoid crypto entirely. Others may seek guidance from scholars who hold different views. Many Islamic finance experts encourage Muslims to consult knowledgeable, trusted scholars for their own situation rather than relying on social media summaries.

For the state, the challenge is to build financial policy that respects religious sensitivities while managing a technology that millions already use. This balance, between faith, regulation, and innovation, is one Pakistan will have to work through carefully in the coming years.

Future Outlook

This fatwa is unlikely to be the end of the conversation. Expect continued debate among scholars, more questions from the public, and careful navigation by the government as it finalizes crypto taxation and regulation. Other scholars may issue their own opinions, adding further perspectives.

What is clear is that cryptocurrency in Pakistan now sits at the crossroads of three powerful forces: religion, regulation, and technology. How the country reconciles them will shape its digital-asset future.

Conclusion

Mufti Taqi Usmani's fatwa declaring cryptocurrency trading impermissible is a significant religious and social development in Pakistan. Its reasoning rests on the Islamic concept of maal, and its influence, given the scholar's stature, will be real for many Muslims. At the same time, it is a religious opinion rather than state law, and the global scholarly community remains genuinely divided on the question. For Pakistan's millions of crypto users, this becomes a matter of personal conscience, best navigated with guidance from trusted scholars. What is certain is that the conversation around faith, finance, and digital assets in Pakistan is far from over.

This article is for general informational purposes only. It reports on a religious ruling and the surrounding debate but does not provide religious guidance, and is not financial or investment advice. Readers seeking religious rulings for their own situation should consult qualified scholars they trust. Cryptocurrency also carries significant financial risk regardless of religious considerations.