ISLAMABAD, July 13, 2026, 15:13 (PKT)
Pakistan’s crypto regulator is in talks with top Islamic scholar Mufti Taqi Usmani after a fatwa declared that crypto purchases are not acceptable under Islamic law, pushing a religious dispute into the country’s still-forming licensing plan. Bilal bin Saqib, chairman of the Pakistan Virtual Assets Regulatory Authority, said tokens should be considered case by case based on their design and use. Usmani has not shifted his view.
Investors are concerned about timing. Rules for virtual-asset service providers are still in draft, and companies are only at the early NOC stage before they can apply for full licences. The Virtual Assets Act from March creates a Shariah Advisory Committee and lets PVARA decide how to classify products by what they do and their economic impact. So, the debate goes straight into the regulatory process.
Saqib separated unbacked cryptocurrencies from stablecoins, which are pegged to a currency, and from tokenised real-world assets, meaning digital claims on things like bonds or commodities tracked on a blockchain. These deserve “careful technical assessment alongside rigorous Shariah examination, rather than being viewed through a single lens,” he said after a meeting with Usmani. Arab News PK
The fatwa takes a more limited approach than headlines that called it a total ban on crypto trading. The June 10 ruling addressed questions about buying books and an online course with crypto. It said those deals weren’t valid since crypto doesn’t count as maal, or recognized wealth, in Islamic law. The text called out Tether’s USDT by name and labeled crypto “merely the recording of fictitious numbers in an account.” Business Recorder
A fatwa isn’t a legal ban in Pakistan and can’t trump law or court rulings. The power of a fatwa comes down to whether people choose to follow it and how much authority the scholar holds. That legal line lets PVARA keep handing out licenses, but the business risk is unchanged: state approval doesn’t guarantee products will find buyers, win over banks, or clear Islamic-finance hurdles.
Pakistan’s payment market is big. Workers sent home $41.6 billion in remittances for the year through June, up 8.6% from the year before. That includes $3.5 billion for June alone. The government has also made a deal with a World Liberty Financial affiliate to explore the use of its dollar-linked USD1 stablecoin for regulated cross-border payments and remittances.
Pakistan is looking for Binance to look at tokenising up to $2 billion worth of sovereign bonds, Treasury bills and commodity stocks. Both Binance and HTX have initial approval for licence applications. The assets in question are about 4.8% of the country’s recent annual remittance total, which could matter for launch timing and partner investment if there are questions about eligibility.
Formalising is proving tougher. Officials say around 40 million Pakistanis are already using digital assets, mostly via informal or unregulated channels. The State Bank of Pakistan allows limited-purpose accounts for NOC holders and full transactional accounts for licensed providers. But it still bans banks from investing in, trading, or holding virtual assets with their own funds or client deposits. A slow licensing roll-out could push more activity offshore, missing out on tax, anti-money-laundering, and consumer protection.
The outcome isn’t clear-cut. Regulators might look at each product separately, letting fully backed stablecoins and asset-backed tokens get a different treatment than unbacked coins. But if PVARA’s Shariah advisers use the fatwa’s argument against USDT, exchanges could end up with fewer tokens, slower product launches, and less interest from retail buyers even for legal services. There’s talk of more discussions, but no deal yet.
Now the key steps are regulatory, not just talk: final licensing rules, Shariah committee guidance, and any separate decision on stablecoins or tokenized government assets are all still needed. Without those, an NOC only means a spot in the licensing lineup for now. It doesn’t mean Pakistan’s digital finance products are approved or will see real traction.
