Crypto Trading is Haram: Pakistani Cleric’s Fatwa
Trading based Cryptocurrency is haram and impermissible as per the Islamic Shariah Law, Mufti Muhammad Taqi Usmani, one of Pakistan’s top Muftis, has ruled
Islamabad: Trading based Cryptocurrency is haram and impermissible as per the Islamic Shariah Law, Mufti Muhammad Taqi Usmani, one of Pakistan’s top Muftis, has ruled.
Mufti Taqi Usmani, President of Wifaq-ul-Madaris Al-Arabia Pakistan and Darul Uloom Karachi, is his fatwa ruled that buying based on the findings and opinions of experts consulted so far, cryptocurrency does not qualify as maal (property or wealth) in Shariah, but is merely a record of notional numbers in an account, The News reported.
Mufti Usmani said that purchasing goods through cryptocurrency is not permissible, whether the payment is made using USDT (Tether) or any other crypto token.
The Timing of the Fatwa
The fatwa came days after reports said that the Ministry of Finance, Pakistan signed a memorandum of understanding with SC Financial Technologies, an affiliate of World Liberty Financial, to explore the use of its dollar-pegged USD1 stablecoin for cross-border payments.
The cryptocurrency platform World Liberty Financial (WLF) is a family venture of U.S. President Donald Trump. Trump’s financial earnings last week revealed that World Liberty Financial brought him more than $500m from token sales alone last year.
The fatwa was issued in response to a question asking whether purchases made using cryptocurrency were valid under the Islamic law. The questioner stated that he had bought two books from a person, one using a crypto token and the other using USDT (Tether), and asked whether the transactions were religiously valid and what he should do if they were not.
Mufti Taqi Usmani advised the citizen to return the books to the seller, as the purchase through cryptocurrency was impermissible.
Mufti Taqi Usmani’s son, Hassan Usmani, meanwhile confirmed that the fatwa circulating on social media was authentic and had indeed been issued by his father.
Views of Saudi scholars on Cryptocurrency
There is no official declaration from Saudi Arabia's Council of Senior Scholars (or the Grand Mufti) about cryptocurrency or crypto trading. Instead of announcing a blanket ban, Saudi religious authorities and government bodies have taken a cautious approach.
But, individual Saudi scholars have issued differing personal opinions on the matter. Some Saudi scholars like Sheikh Assim al-Hakeem and Sheikh Abdullah Al-Manea are of the view that Cryptocurrencies are impermissible and haram due to excessive ambiguity (gharar), lack of backing by trusted institutions and potential for harm.
On the other hand, Sheikh Abdul-Rahman bin Nasir al-Barrak described Bitcoin and other crypto currencies compliant with Sharia, likening them to check or cash and acceptable as a medium of exchange.
The Muslim scholars are not alone talking against the use of cryptocurrencies. There are countries like China, Afghanistan, Nepal, Bangladesh, Algeria, North Macedonia and others where all cryptocurrency transactions, trading, mining, and related services are illegal.
In countries like India and Russia there is not a blanket ban on Cryptocurrencies but the local laws in the countries allow their use with warnings.
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