By Staff Reporter
ISLAMABAD: Pakistan’s top digital-assets regulator met with one of the country’s most influential Islamic scholars over the weekend, seeking to contain fallout from a religious ruling that cast doubt on the legitimacy of cryptocurrency under Shariah law just as the South Asian nation races to build out a regulatory framework for the industry.
Bilal bin Saqib, chairman of the Pakistan Virtual Assets Regulatory Authority, described his meeting with Mufti Taqi Usmani as a “constructive discussion” in a post on X, adding that the two were “united on one fundamental objective: protecting Pakistanis from fraud, exploitation, and financial harm.”
The talks followed a fatwa issued June 10 by Usmani and six other scholars at Darul Ifta, Jamia Darul Uloom in Karachi, which found that using cryptocurrency to purchase goods was impermissible. The ruling was signed by Usmani and five other prominent scholars. It concluded that digital tokens do not constitute “maal,” or wealth, under Islamic jurisprudence, describing them instead as merely the recording of fictitious numbers in an account — whether in the form of Tether’s USDT stablecoin or other crypto tokens. Because cryptocurrency was not recognised as wealth, the edict found that buyers using it did not legally take ownership of whatever they purchased, citing several works of Islamic jurisprudence to support its reasoning. The fatwa was issued in response to a question about whether a purchase of two books — one bought with a crypto token, the other with USDT — was valid under Islamic law, and separately found that an educational course bought with cryptocurrency could not be validly obtained either.
The scholars’ intervention lands at a delicate moment for Saqib, who has spent the past year and a half building the legal and institutional scaffolding for Pakistan to become a formal player in digital finance — an effort that depends heavily on the sector maintaining religious legitimacy in a country where Islamic finance principles carry significant weight over how millions of citizens invest and transact.
In his X post, Saqib argued that blockchain technology, digital assets, stablecoins and tokenised real-world assets span a wide range of use cases that shouldn’t be evaluated uniformly. “They merit careful technical assessment alongside rigorous Shariah examination, rather than being viewed through a single lens,” he wrote, adding that he hoped for continued engagement between scholars, regulators and industry experts so that “Pakistan’s approach is guided by both Islamic principles and a comprehensive understanding of emerging technologies.”
There was no indication that Usmani had altered his underlying position following the meeting. The fatwa specifically holds that changing terminology — from cryptocurrency to virtual currency, token or stablecoin — does not change the underlying religious status, treating all such instruments as falling under the same prohibition. Usmani serves as president of Jamia Darul Uloom Karachi and Wifaq-ul-Madaris Al-Arabia Pakistan, one of the country’s largest networks of Islamic seminaries, giving his rulings outsized influence over how observant Muslims in Pakistan view financial products even though a fatwa carries no legal force.
Stakes Extend Beyond Religious Doctrine
The dispute underscores the delicate balance Islamabad is trying to strike as it moves to formalise what has largely been an informal, unregulated crypto economy. Pakistan ranks third globally in grassroots crypto adoption behind only India and the United States, according to Chainalysis’s 2025 Global Crypto Adoption Index, a position the firm attributes to a young, mobile-first population, one of the world’s largest freelance economies, more than $38 billion in annual remittances, and growing use of stablecoins as a hedge against inflation. Saqib has previously said that roughly 40 million Pakistanis are already engaged with digital assets, the bulk of it through platforms operating outside any regulatory perimeter.
That scale of adoption predates the regulatory apparatus now being built around it. As Saqib has framed it, Pakistan did not adopt digital assets as a result of regulation — it adopted them first, and the government is now writing rules to catch up.
PVARA itself is a relatively young institution. The authority was established in July 2025 through a presidential ordinance and later given legal standing through the Virtual Assets Act 2026, which the State Bank of Pakistan enacted in April, allowing banks to open accounts for licensed virtual-asset service providers for the first time. The authority is overseen by a multi-stakeholder board that includes the State Bank governor along with the chairmen of the Securities and Exchange Commission of Pakistan and the Federal Board of Revenue, and its mandate spans curbing illicit finance, protecting consumers, and encouraging Shariah-compliant innovation through regulatory sandboxes.
Saqib, who also holds the title of state minister for crypto and digital assets, has been the public face of Pakistan’s crypto ambitions since early 2025. He was appointed chief adviser to the finance minister on crypto affairs and has since led the National Crypto Council, formed in February 2025 to develop a regulatory framework and pursue foreign investment in the sector. Binance co-founder Changpeng Zhao joined as an adviser to that council in April 2025, and Saqib later announced the launch of Pakistan’s first government-backed Strategic Bitcoin Reserve. He also serves as chief executive officer of the Pakistan Crypto Council, launched in March 2025, though the current status of that body is unclear.
In December, Saqib announced plans for Pakistan to launch its first stablecoin, part of a broader push to weave virtual assets into the formal economy. A stablecoin is a digital token whose value is pegged to a traditional currency, such as the US dollar, making it considerably less volatile than cryptocurrencies like Bitcoin.
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