Pakistan's crypto regulator moves to distinguish speculative cryptocurrencies from asset-backed tokens

According to Odaily, Bilal bin Saqib, Chairman of the Pakistan Virtual Assets Regulatory Authority (PVARA), has requested that Jamia Darul Uloom Karachi clarify the distinction between speculative cryptocurrencies and asset-backed digital tokens, following a recent ruling by the religious institution which determined that purchases based on cryptocurrencies do not comply with Islamic law.

This ruling pertains to consultations about using cryptocurrencies to pay for books and online course fees. Waqas Ghani, Director of Research at JS Global Capital, stated that this decision could hinder bank-led cryptocurrency adoption in Pakistan, although trading volumes have not yet been affected.

Saqib stated that PVARA is working with scholars to evaluate digital assets by category, rather than treating them as a single class. He noted that Islamic bonds recorded on blockchain represent ownership of real income-generating assets, while gold-backed tokens and fully reserved stablecoins correspond to redeemable value.

He pointed out that speculative tokens without underlying assets constitute a separate concern that must be taken seriously by scholars. PVARA will continue to work with scholars as Pakistan develops a licensing framework and advances initiatives in stablecoins and real-world asset tokenization.