Pakistan Tackles Crypto Fatwa Clash With 40M Users at Stake

Bilal bin Saqib, chairman of the Pakistan Virtual Assets Regulatory Authority (PVARA), met Islamic scholar Mufti Muhammad Taqi Usmani around July 11, 2026, in Pakistan to seek clarity after a fatwa declared crypto-based purchases impermissible under Shariah law. The ruling, issued June 10 by scholars at Darul Uloom Karachi, threatens to slow Pakistan's fast-moving crypto regulation efforts in a country where an estimated 40 million people already hold digital assets.

Pakistan Crypto Regulation Faces a Religious Reality Check

The fatwa concluded that digital assets, including stablecoins like USDT, do not qualify as “maal,” or recognised wealth, under Islamic law. This means that purchases made with them are technically invalid. Saqib pushed back gently, arguing that cryptocurrencies, stablecoins, and tokenised assets deserve separate scholarly review rather than a single blanket ruling. PVARA was created under the Virtual Assets Act 2026, which mandates a Shariah Advisory Committee specifically to navigate this kind of tension.

How Pakistan's Crypto Licensing Plans Could Be Affected

So far, trading volumes appear unaffected, according to Waqas Ghani, head of research at JS Global Capital, though he warned the edict could still slow bank-led adoption beyond Pakistan's existing trading community. PVARA's licensing framework for exchanges remains on track, with approvals expected in the coming months.

Retail trading looks stable for now, but banks and institutions may hesitate until Shariah-compliance questions are resolved.

PVARA's Shariah Advisory Committee is likely to issue category-by-category guidance, separating payments from investment and custody use cases.

Analysts say Usmani's influence in Islamic finance means the fatwa could shape public sentiment even though it carries no legal force.