KARACHI: Digital currency sho­u­ld be legalised with certain conditions, BankIslami Ltd Shariah Advi­sory Board Chairman Mufti Irshad Ahmed Ijaz said at a seminar held this week at the University of Karachi.

According to a press release, Mr Ijaz said digital currency is not fictitious. “It is a reality. It should be justified under certain conditions,” he said.

Participating in the discussion on the technical and Shariah status of digital/cryptos jointly organised by the university’s Department of Usool Uddin and Al-Asr Foundation, he said the government should play a positive role in this regard and eliminate any confusion.

Crypto expert Mufti Owais Paracha said crypto-currencies originated with bitcoin, which was developed in 2009 by an unknown programmer.

He said Satoshi Nakamoto, which is the name used by the person or persons who developed bitcoin, made the new decentralised digital currency invincible by incorporating cryptography and the qualities of past currencies.

“This currency works on blockchain — a technology in which data is recorded in the form of blocks and a copy is sent to all connected computers through a peer-to-peer network. Every transaction is verified by a third party that’s called a minor,” he said, adding that a new bitcoin is created after verification and given to the miner.

This process continued after the emergence of bitcoin and many other currencies. “Then there are blockchains that could run smart contracts, which are software that do not require administrators to run,” he said.

The chairman of the university’s business school, Dr Danish Ahmed Siddiqui, said that the use of crypto is becoming increasingly common in the world. He added that only scholars can give an informed opinion about its authenticity.

Published in Dawn, February 26th, 2022