Key takeaways
- No single ruling exists. Published positions run from permitted on conditions to prohibited, and each depends on the token and how it is used.
- Permitting: on 29 June and 20 July 2020 the Shariah Advisory Council of Securities Commission Malaysia recognised digital assets as property and allowed trading on exchanges registered with the regulator.
- Prohibiting: a fatwa by Mufti Muhammad Taqi Usmani, reported on 10 July 2026, holds that crypto is not property and that paying for goods with it, USDT included, is not permissible.
- Scholars apply five tests: property, interest (riba), excessive uncertainty (gharar), gambling (maysir) and lawful purpose. AAOIFI's standards do not permit futures, options or buying on margin, and scholars apply the same rules to crypto.
- A label is not a ruling. Fasset's own list marks 188 of 240 assets as compliant but names no reviewer, method or date.
The short answer: scholars disagree, and the asset matters
Crypto is neither halal nor haram as a category: published rulings split three ways, and each depends on the token and its use. Between 2020 and 2026 a regulator's Shariah council in Malaysia, a national council of scholars in Indonesia and a senior jurist in Pakistan each reached a different conclusion on whether cryptocurrency is halal in Islam.
This guide is an explainer, not a religious ruling. It sets out what each body said, the five tests behind the rulings and a way to check a coin yourself. It does not tell you what to do; for that, ask a scholar whose judgement you trust. It is one of the guides in the Fasset Learn hub.
The permitting view
Digital assets are property. The Shariah Advisory Council of Securities Commission Malaysia resolved this at meetings on 29 June and 20 July 2020, and allowed trading on exchanges registered with the regulator, on conditions about what a token funds and what rights it carries.
The prohibiting view
Crypto is not property. A fatwa by Mufti Muhammad Taqi Usmani of Darul Uloom Karachi, reported on 10 July 2026, treats it as a record of numbers in an account, so paying for goods with it, in USDT or any other token, is not permissible.
Between the two stands the Indonesian Ulema Council (MUI). Its November 2021 decision prohibits crypto as a currency and as a commodity, but allows trading in a token that meets the Shariah conditions for goods and has an underlying asset and a clear benefit. Whether crypto is halal or haram is also a different question from what the law of your country allows: a sister guide covers whether crypto is legal in the UAE.
The five tests scholars apply
Scholars who rule on crypto apply five tests from the Islamic law of contracts: property, interest, uncertainty, gambling and lawful purpose. The usual reference for those contract rules is the Shari'ah Standards of AAOIFI, the Accounting and Auditing Organization for Islamic Financial Institutions. Its published English volume holds 54 standards and none of them is about crypto-assets, so scholars reason by analogy from the standards on currencies, loans, uncertainty and organised markets.
Is it property (mal)?
The first test is whether a token is mal: something that has value, can be traded and must be made good if someone damages it. That is the classical definition the Malaysian council cites, and it is where the two camps part. The council answered yes for the digital currencies and tokens its regulator supervises. The fatwa reported in July 2026 answered no: it treats a crypto balance as a notional record, not as wealth. On that view a purchase paid for in crypto is not a valid sale, and the other four tests never arise.
Riba: is interest involved?
Riba is, at its simplest, any excess a lender stipulates on a loan, and it is prohibited whatever it is called. AAOIFI's standard on loans (No. 19) states the rule in those terms. Owning a token outright involves no loan. Lending it for a fixed return, borrowing to buy it, or being paid for leaving a balance with a platform can.
A second rule applies to currency-like tokens. The Malaysian council treats a token backed by gold, silver or currency as a currency, so exchanging it follows the rules of currency exchange (bai al-sarf). AAOIFI's standard on trading in currencies (No. 1) requires both sides to take possession before they part and bars forward and futures deals.
Gharar: is the uncertainty excessive?
Gharar is uncertainty about what is being exchanged, and it voids a contract only when it is excessive. AAOIFI's standard on gharar (No. 31) sets four conditions: the contract is an exchange, the uncertainty is excessive, it concerns the main subject matter, and no recognised need justifies it. Uncertainty is excessive when it dominates the contract and is likely to cause a dispute.
For a coin the questions are practical: what the token is, what rights it carries, how many exist and whether it can be delivered to you. Whether a volatile price is itself gharar is disputed. The standard's own examples concern goods that may not exist, terms that are not fixed and delivery that may not happen, not price movement, while the Indonesian decision lists gharar among its grounds.
Maysir: is it gambling?
Maysir, also called qimar, is gambling: a stake on an uncertain outcome in which one side's gain is the other side's loss. The test separates buying something from betting on its price. AAOIFI's standard on organised markets (No. 20) explains its ban on futures partly this way: most such contracts end in a cash settlement, and delivery was never the purpose. A purchase that puts the token in your own wallet is a sale. A contract that only pays the difference between two prices is treated as a wager. The Indonesian decision lists qimar among its reasons for rejecting crypto as a commodity.
Is the underlying activity lawful?
A token that passes the first four tests still fails if what it funds or represents is prohibited. The Malaysian resolution sets two conditions for a digital token: the money raised must go to Shariah-compliant purposes, and the rights and benefits attached to the token must be Shariah-compliant. Where a project mixes compliant and non-compliant activity, the council applies the business-activity benchmarks it uses to screen listed shares. This is the test that removes tokens tied to interest-based lending, gambling or other prohibited trades, whatever their technology.
Other terms used in this guide
- Fatwa: a scholar's or council's opinion on a question of Islamic law. It binds those who follow that authority.
- 'Urudh: goods, meaning property other than currency.
- Ribawi items: items such as gold, silver and currency whose exchange is subject to the riba rules.
- Sil'ah: a commodity that can lawfully be sold.
- Nisab: the minimum wealth above which zakat is due.
Rulings that permit crypto, and their conditions
The clearest permitting ruling is the 2020 resolution of the Shariah Advisory Council (SAC) of Securities Commission Malaysia on digital assets from a Shariah perspective. The council adopted it at its 233rd meeting on 29 June 2020 and its 234th meeting on 20 July 2020. The regulator's chairman summarised it in a keynote on 20 April 2021: the council had recognised digital assets as an asset in Shariah terms and allowed them to be traded on regulated digital asset exchanges.
The resolution draws three lines:
- A digital currency built on technology alone, with no underlying asset, is goods ('urudh), not currency. It is not a ribawi item, so the rules of currency exchange do not apply to trading it.
- A digital currency backed by gold, silver or currency is treated as a currency, and trading it follows the rules of currency exchange.
- A digital token is property in the class of goods. Its status depends on two conditions: the proceeds of its issue fund Shariah-compliant purposes, and the rights and benefits it carries are Shariah-compliant.
The permission has limits. It covers only digital assets within the Malaysian regulator's jurisdiction, and only investment and trading on a digital asset exchange registered with it. It is a ruling for one supervised market, not a statement about every coin on every platform.
Rulings that prohibit crypto, and their reasons
The most recent prohibiting ruling is a fatwa by Mufti Muhammad Taqi Usmani of Darul Uloom Karachi, reported by The News on 10 July 2026. The Pakistani daily describes him as the president of that seminary. According to its report, a man asked whether two purchases were valid: he had bought two books, one with a crypto token and one with USDT. The fatwa answers that, on the findings of the experts consulted so far, cryptocurrency does not qualify as maal and is only a notional entry in an account. Buying goods with it is therefore not permissible, whichever token is used, and the buyer was told to return the books. The report adds that the scholar's son confirmed the fatwa as authentic.
The ruling carries weight in Islamic finance: the chairman's foreword to AAOIFI's published volume of Shari'ah Standards is signed by Muhammad Taqi Usmani. It remains a religious opinion on the question asked. It binds those who follow that authority and, as reported, it rests on the expert views gathered so far.
Indonesia's council of scholars is stricter than Malaysia's but leaves an exception. The seventh gathering of the MUI Fatwa Commission, held in Jakarta on 9 to 11 November 2021 with 700 participants, set out three provisions on cryptocurrency:
- Using cryptocurrency as a currency is haram, because it involves gharar and harm (dharar) and conflicts with Indonesian Law No. 7 of 2011 and Bank Indonesia Regulation No. 17 of 2015.
- Crypto as a commodity or digital asset is not valid to trade, because it involves gharar, harm and gambling and does not meet the conditions for a lawful commodity (sil'ah): a physical form, value, a known quantity, ownership and the ability to hand it to the buyer.
- A crypto-asset that does meet those conditions, and has an underlying asset and a clear benefit, is valid to trade.
| Body | Date | Ruling in one line | Scope and conditions |
|---|---|---|---|
| Shariah Advisory Council, Securities Commission Malaysia | 29 June and 20 July 2020 | Digital assets are property; trading is permissible | Assets under the Malaysian regulator, on exchanges registered with it; a token's proceeds and rights must be Shariah-compliant |
| Fatwa Commission, Indonesian Ulema Council (MUI) | 9 to 11 November 2021 | Haram as a currency; not valid as a commodity unless it qualifies as one | Tradable only if it meets the commodity conditions and has an underlying asset and a clear benefit |
| Mufti Muhammad Taqi Usmani, Darul Uloom Karachi | Reported 10 July 2026 | Not property; paying for goods with it is not permissible | An answer to one question about a purchase; the fatwa's own text was not read for this guide |
| Sources 1 to 4 in the list below. Each ruling is a religious opinion; none is a law. | |||
How the tests apply to Bitcoin and to stablecoins, in brief
The two assets most readers ask about split the scholars in different ways. Each gets a short summary here.
Bitcoin
Bitcoin has no issuer and pays its holders nothing, so owning it does not by itself raise the interest test. The split is over property. Under the Malaysian framework a digital currency based on technology alone is goods that can be owned and traded, where the regulator has approved it. Under the July 2026 fatwa no cryptocurrency is property. The Indonesian decision asks whether the asset has an underlying and a clear benefit. Bitcoin's price is highly volatile, which is why the uncertainty and gambling tests are raised even for outright purchases. How you hold it matters as much as what it is.
USDT and other stablecoins
USDT is different in kind: a company, Tether, issues and redeems it, and each token refers to one unit of a currency. Tether's terms, last updated on 26 February 2026, set the redemption price at one US dollar per USDT for its verified customers and contain no clause that pays holders interest or yield. Under the Malaysian framework a token backed by currency is treated as currency, so the rules of currency exchange apply. The July 2026 fatwa names USDT and reaches the opposite result. Scholars also ask what an issuer holds in reserve; this guide does not describe Tether's reserves, because the issuer's latest report was not read.
Staking, futures and margin
Many scholars who accept owning a coin outright still reject futures, options and margin trading, which add interest, deferred exchange or a price bet. AAOIFI's standards do not mention crypto, but they state the rules that scholars carry over by analogy:
- Futures and options: the standard on commodities in organised markets (No. 20) does not permit forming or trading either contract.
- Currency forwards: the standard on trading in currencies (No. 1) bars forward and futures deals and requires both sides to take possession before they part.
- Margin and short selling: the standard on shares and bonds (No. 21) does not permit buying shares with an interest-bearing loan from a broker, or selling shares the seller does not own.
Whether staking is halal in Islam depends on its mechanism, not its name. A reward for helping to validate a network's transactions is one thing. A fixed return for handing tokens to someone else to use looks like a loan with a stipulated excess, which is the definition of riba. None of the rulings cited in this guide addresses staking by name, so the answer for a given product depends on its contract terms and on the scholar you ask.
How to screen a coin yourself
You can screen a coin in five steps: ask one question per test and look for the answer in the project's own documents, not in its marketing. Stop at the first clear failure. Where an answer is unclear, treat it as a question for a scholar, not as a pass.
| Test | Question to ask | Red flag | Where to check |
|---|---|---|---|
| 1. Property (mal) | Can the token be owned, valued and transferred, and what does it give its holder? | No stated use or right; value rests on promotion alone | White paper; the token's terms |
| 2. Interest (riba) | Does holding, lending or locking it pay a fixed or promised return? | A stated rate for lending or holding; borrowing built into the product | Earn, lending or staking terms; the issuer's terms |
| 3. Uncertainty (gharar) | Do you know what you are buying, how many exist and whether it reaches your wallet? | Supply or rights can change without notice; withdrawals are restricted | Token contract and supply schedule; the platform's withdrawal rules |
| 4. Gambling (maysir) | Is this a purchase with delivery, or a contract that only pays a price difference? | Futures, options, leverage, prediction or lottery mechanics | The product type on the order screen; contract specifications |
| 5. Lawful purpose | What does the project earn money from, and what does the token fund? | Income from interest-based lending, gambling or another prohibited trade | Project documents; published accounts or revenue disclosures |
Worked example (illustrative figures, not a real token)
Suppose a token called Coin A is offered in two ways. Bought outright, 500 units cost 500 US dollars and reach your own wallet within minutes. There is no loan, the quantity is known and delivery happens, so tests two to four raise no flag. The result then rests on test one (is it property?) and test five (what does the project do?).
The same platform also offers to pay you 40 units for every 500 you lock for a year, funded by lending them to traders. That offer fails test two: it is a fixed amount paid on a loan, whatever the answer was for the outright purchase. All numbers here are invented to show the method.
Fasset publishes a screening list of its own. When last checked for this guide it covered 240 assets, 188 labelled as compliant and 52 as not compliant, and it showed no reviewer, no method and no date. Fasset's existing guide on this topic names “No named, verifiable Shariah board or certification” as a red flag in other products, and the same test applies to Fasset's list. The list labels both Bitcoin and USDT as compliant, while the July 2026 fatwa reaches the opposite view on USDT, so a label alone cannot settle the question. Until the reviewer, method and date are published, use the list as a starting point for your own screening, not as a ruling.
A label is not a ruling. Ask who screened the coin, by what method, and when.
Zakat on crypto in one paragraph
Where crypto is treated as property, zakat follows, but views differ on which holdings are zakatable. One open point is whether coins held to trade and tokens held to use are treated alike. Fasset's zakat calculator includes crypto-assets and uses a nisab of 85 g of gold or 595 g of silver. Those weights match AAOIFI's standard on zakah (No. 35), which sets the rate on gold, silver, currencies and trade goods at 2.5% for a lunar year. A scholar who holds that crypto is not property would start from a different place. A separate guide to zakat on crypto is planned.
What this means if you use Fasset
Using Fasset does not settle the religious question for you: the company names no Shariah board and publishes no certificate or screening method, so this guide makes no compliance claim for it. What it does state is narrower. Its About page says that every account, service and investment is delivered without interest. That speaks to one of the five tests, riba, and to nothing else. Fasset, the interest-free money app, is not a bank, and the guide on how a USD account works explains what a balance with a non-bank provider is.
The legal position is separate, and you can check it. Fasset FZE is licensed by the Virtual Assets Regulatory Authority (VARA) in Dubai for Broker-Dealer Services, licence VL/23/07/002, issued on 30 November 2023 (VARA register entry for Fasset FZE). Fasset FZE's VARA licence covers Broker-Dealer Services carried on in or from Dubai. Whether Fasset FZE can serve residents of the other emirates, and on what basis, has not been confirmed. The product page explains how to buy USDT in the UAE through a licensed firm.
A licence is supervision of the firm. It is not a religious ruling, and it does not protect the value of what you buy: read the risks of virtual assets first. For what is published about oversight and what is still missing, see Fasset Shariah governance and legal entities.
Frequently asked questions
Is crypto haram according to Mufti Taqi Usmani?
Yes, according to a fatwa that The News reported on 10 July 2026. It holds that cryptocurrency does not qualify as property (maal) and that paying for goods with it, in USDT or any other token, is not permissible. The fatwa answered one question about a purchase and, as reported, rests on the expert views gathered so far. Its own text was not read for this guide.
Is crypto trading halal in the UAE?
The country does not decide it. Whether crypto trading is halal depends on the asset, the contract and the scholar you follow, and the rulings in this guide come from Malaysia, Indonesia and Pakistan. Whether it is lawful is a separate question of UAE regulation: in Dubai, outside the DIFC, the regulator for virtual assets is VARA. See the guide on whether crypto is legal in the UAE.
Is day trading crypto halal?
None of the rulings cited here addresses day trading by name, so the five tests decide it. Buying and selling a token you own, with delivery each time, is trading of the kind the Malaysian resolution permits on registered exchanges. Day trading with borrowed funds, leverage or contracts settled only in cash meets the interest and gambling tests. Scholars who hold that crypto is not property reject all of it.
Are crypto futures halal or haram?
Under AAOIFI's Shari'ah Standards futures are not permitted, and scholars apply that to crypto futures by analogy, which makes them haram on that view. Standard No. 20 does not permit forming or trading futures or options, and standard No. 1 bars forward and futures deals in currencies. The reasons are deferred exchange without possession and cash settlement of price differences. Margin trading adds an interest-bearing loan.
Who decides whether a coin is halal?
No single body decides for all Muslims. A ruling comes from a scholar, a national fatwa council or a Shariah board, and it binds those who follow that authority. A regulator's Shariah council, such as the one at Securities Commission Malaysia, rules for its own market. A platform's label is only as reliable as the named reviewer, method and date behind it, so check those before you rely on it.
Sources
- Securities Commission Malaysia, Resolutions of the Shariah Advisory Council: Digital Assets from Shariah Perspective, 233rd and 234th meetings (29 June and 20 July 2020), sc.com.my/development/icm/shariah/resolutions-of-the-shariah-advisory-council-of-the-sc, accessed 12 October 2026.
- Securities Commission Malaysia, keynote address by the chairman at the 8th MFPC e-Conference on Shariah Wealth Management and Financial Planning, 20 April 2021, sc.com.my/resources/speeches/keynote-address-at-8th-mfpc-e-conference-on-shariah-wealth-management-financial-planning, accessed 12 October 2026.
- Majelis Ulama Indonesia (MUI), Keputusan Fatwa Hukum Uang Kripto atau Cryptocurrency, 12 November 2021, in Indonesian, mui.or.id/baca/berita/keputusan-fatwa-hukum-uang-kripto-atau-cryptocurrency, accessed 12 October 2026.
- The News International (Pakistan), Cryptocurrency transactions impermissible under Shariah: Mufti Taqi Usmani, 10 July 2026, thenews.pk/print/1425134-cryptocurrency-transactions-impermissible-under-shariah-mufti-taqi-usmani, accessed 12 October 2026. A press report; the fatwa's own text was not read.
- AAOIFI, Shari'ah Standards, English volume of standards 1 to 54 as published on the page (Nos. 1, 19, 20, 21, 31 and 35 are cited here), aaoifi.com/shariaa-standards/?lang=en, accessed 12 October 2026.
- Tether, Token Terms of Sale and Service, last updated 26 February 2026, tether.to/en/legal/, accessed 12 October 2026.
- Virtual Assets Regulatory Authority, public register entry for Fasset FZE, vara.ae/en/licenses-and-register/public-register/fasset-fze/, accessed 12 October 2026.
- Fasset, the company's own pages, read on 6 and 12 October 2026: the Shariah reports list (fasset.com/shariah-reports/), the zakat calculator (fasset.com/zakat-calculator/), the About page (fasset.com/about-us/) and the guide at fasset.com/blog/is-crypto-halal-shariah-guide/.
Not a ruling and not investment advice
For information only. Not investment, legal, tax or religious advice. This guide summarises published rulings and is not a fatwa. Crypto-assets are volatile, and you may lose the amounts you put in.