September 24, 2022

Islamic Scholar Says Digital Currency is not ‘Fictitious’

Irshad Ahmad Ijaz, an Islamic scholar, has recently asserted that digital currency cannot be called fake currency and there is a need to legitimize it, once it has fulfilled certain conditions. There were a number of other scholars who also echoed the same sentiment while attending a seminar that examined the status of these digital currencies from the Islamic law perspective. Also called Mufti, the Islamic scholar had recently argued that it is not appropriate to call digital currencies ‘fictitious’. According to a report, Irshad Ahmad Ijazsuggested that it was possible to justify the currency, once it is able to meet certain conditions.

These remarks were put forward by Ijaz at a seminar that had recently been conducted on the topic of cryptocurrencies in Pakistan. It was organized by the Al-Asr Foundation and the University of Karachi. Academia published a report on the seminar and said that Ijazhad also urged the Pakistani government during the seminar to play its role in eliminating the uncertainty and confusion surrounding these cryptocurrencies in the country. Another scholar by the name of IshaqAlam was also quoted in the report. He had suggested that it was essential for Islamic scholars to understand that the world has now entered a digital age.

This means that there are new problems that require new solutions. According to Alam, this understanding would help the Islamic scholars in issuing proper guidance and rules relating to cryptocurrencies. Mufti OwaisParacha, another crypto expert that the report quoted, also shared the same sentiments. He stated that previous attempts of creating a digital currency had been a failure until the creation from Satoshi Nakamoto in the form of Bitcoin had finally succeeded. Paracha went on to say that the reason behind bitcoin’s success was that it had combined the so-called techniques that previous currencies had used with cryptography.

Scholars also asserted elsewhere in the report that there is more research that needs to be done on the topic of digital currencies. It said that doing so would help the scholars in offering opinions that can give guidance to the users as well as holders of these digital currencies in the country. These were some of the sentiments that had been expressed by Pakistani scholars. The come shortly after Reza Baqir, the governor of the central bank in Pakistan, had issued a warning in a speech about the potential risks of cryptocurrencies that he said are significantly higher than the benefits.

Baqir had also added that these assets are also a threat to the country’s financial stability. His stance is not very different from the central bank officials of some other countries around the world, including Russia. They also believe that cryptocurrencies can be a great risk to the financial stability of a country. Despite the remarks by the governor, it had been reported in December 2021 that the crypto assets currently in possession of Pakistanis are currently in excess of $20 billion. But, the assets still remain unregulated in Pakistan.

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