Pakistan Crypto Regulator Seeks Clarity on Digital Assets from Islamic Seminary

Bilal bin Saqib, Chairman of Pakistan Virtual Assets Regulatory Authority (PVARA), has requested Jamia Darul Uloom to differentiate between speculative cryptocurrencies and asset-backed digital tokens. This request follows a religious decree (fatwa) issued on June 10 by Mufti Taqi Usmani and six others, which declared crypto-based purchases impermissible under Islamic law. The fatwa described cryptocurrency as "merely the recording of fictitious numbers in an account," casting doubt on Pakistan's growing embrace of digital assets, a market where it ranks highly in retail activity. Saqib explained that PVARA is engaging with the seminary to categorize digital assets individually, rather than treating them as a monolithic class. He highlighted that instruments like blockchain-recorded sukuk, gold-backed tokens, or fully reserved stablecoins represent ownership of tangible, income-generating assets or carry enforceable claims on something real. Saqib emphasized that blockchain is fundamentally a record-keeping technology, not a financial asset itself. He acknowledged that purely speculative tokens without underlying assets warrant serious consideration of scholars' concerns. PVARA aims to collaborate closely with scholars as Pakistan develops its licensing framework for stablecoins and real-world asset tokenization, seeking to lead in Shariah-compliant digital finance. The fatwa, in its current form, could impede broader crypto adoption beyond urban trading communities, although crypto trading volumes have reportedly remained unaffected thus far. Saqib recently held a constructive discussion with Mufti Usmani, presenting digital assets, stablecoins, and tokenized real-world assets as a diverse spectrum of technologies and use cases.