Pakistan's Crypto Shariah Debate Divides Top Islamic Scholars

Pakistan's top Islamic scholars are at odds over whether cryptocurrency is halal. The debate centers on whether crypto follows Shariah, Islam's legal code. Mufti Taqi Usmani and other senior scholars issued a fatwa in June, ruling that purchases made with Bitcoin (BTC), stablecoins, and digital tokens are not real wealth under Islamic law.

The fatwa was signed by Mufti Usmani, who advises Meezan Bank on Shariah compliance. His word has moved markets before; in 2008, he judged that up to 85% of sukuk failed Shariah tests, causing global sukuk issuance to plummet from $50 billion to about $15 billion.

Pakistan is one of the world's largest crypto markets, and its government wants to lead in digital assets. The country ranks third worldwide for grassroots crypto adoption, behind only India and the US, according to Chainalysis.

However, not all Muslim clerics agree with Usmani's ruling. Saylani Welfare International Trust, a large charity in Pakistan, disagrees and has issued its own fatwa, allowing trade in cryptocurrencies as long as it does not expose individuals to unlawful humiliation or consequences.