# Why did Mufti Taqi Usmani declare cryptocurrency haram? ft Qanit Khalilullah | TBT Podcast

An episode of [Thought Behind Things](https://invisiblenetwork.ai/podcast/1532974013), 31 Jul 2026, 1 h 25 min.

Audio: https://anchor.fm/s/36c5ffa4/podcast/play/123575593/https%3A%2F%2Fd3ctxlq1ktw2nl.cloudfront.net%2Fstaging%2F2026-6-31%2F428963109-44100-2-73e15f742ccfd.mp3

Kanit Khalilullah explains why Pakistan's debt-based banking system is a bigger trap than cryptocurrency, and how full reserve banking could eliminate domestic debt. Join the Inner Circle, my weekly letter on AI, building, and being early to what's coming: https://muzamilhasan.com/inner-circle Read the thesis, the one idea behind everything I'm building: https://muzamilhasan.com/thesis My website: https://muzamilhasan.com Kanit Khalilullah returns to explain the real crisis behind Pakistan's economy: fractional reserve banking. While Mufti Taqi Usmani's recent fatwa against cryptocurrency made headlines, the elephant in the room is how commercial banks create money out of thin air through debt, inflating the currency supply by 50% in just three years. Pakistan's domestic debt has ballooned from 5 trillion to 55 trillion rupees in 15 years. Every month, the government borrows 500 billion rupees from banks and immediately pays it back as interest, feeding a cycle that now consumes 60% of tax revenue. By 2032, debt payments will eat 93% of the federal budget. Kanit argues that full reserve banking, where the state controls money creation, could eliminate domestic debt, end inflation, and restore economic stability. This is not theoretical. His book, Breaking the Trap of Debt, Inflation, Interest, and Poverty, has been reviewed by 20 economists and bankers, including the deputy chairman of Faysal Bank and Arif Habib. The solution exists. The question is whether Pakistan's policymakers, military leadership, and religious scholars will confront the system that benefits a few at the expense of 250 million people. Chapters: 0:00 Mufti Taqi Usmani's cryptocurrency fatwa and the real debate 5:10 Why Bitcoin is not currency but speculation 11:35 Bitcoin as a hedge against dollar liquidity 15:47 Gold standard vs fractional reserve banking 20:00 How Pakistan's debt jumped 31 to 46 trillion in 3 years 28:58 93% of federal budget will go to debt by 2032 1:06:24 The book that could end Pakistan's debt trap 1:08:35 Have policymakers, army, or clergy responded? 1:14:27 Islamic banking's cosmetic wrappers on the same system 1:18:11 DG Budgets Pakistan Army's 2032 debt projection 1:22:04 Next steps: advocacy, courts, and awareness Instagram: https://instagram.com/muzamilhasan LinkedIn: https://www.linkedin.com/in/muzamilhasan #FractionalReserveBanking #PakistanDebt #IslamicFinance #BitcoinDebate #FullReserveBanking

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