UAE’s New Financial Law: DeFi and Web3 Brace for a Wild Ride

by

Hold onto your digital wallets, folks! The UAE has just passed a financial law that might make your favorite DeFi platform look more like a bank branch than a decentralized utopia. Welcome to Federal Decree Law No. 6 of 2025, where your crypto transactions could soon be as regulated as your morning coffee order. ☕

According to Irina Heaver, a local crypto lawyer and founder of NeosLegal (who clearly knows her stuff), this new law marks a huge shift in the region’s crypto scene. It’s like the government saying, “Hey, nice decentralized exchange you have there. Let’s add some rules, shall we?” 😏

Now, before you go running to the nearest exit with your stablecoins, here’s the scoop: this law doesn’t just target DeFi platforms, it’s after anyone who’s into crypto payments, lending, or anything that involves handling digital assets in the UAE. And guess what? They want you to get a license for that! Yes, even you, the person who thought ‘just code’ would keep you safe. Nope. 🛑

“We’re just code” is no longer a defense

That’s right, folks. As of September 16, 2025, the UAE says “too bad” to the “we’re just code” excuse. If you’re offering crypto payments or handling digital assets, you’ll need to get a fancy Central Bank of the UAE (CBUAE) license. We’re talking full-blown regulations for anything that enables the transfer or storage of digital assets. The law even has a cool Article 61 and 62 to make sure everyone gets in line. 🔏

DeFi in the UAE

Oh, and don’t think decentralization is your get-out-of-jail-free card. The law’s like, “Nice try!” and now even protocols that support stablecoins, decentralized exchanges, or liquidity routing may need to cough up a license. And the penalties? Oh, just a little fine of up to 1 billion dirhams (that’s $272.3 million) and maybe even some jail time. No biggie, right? 😬

The law does not ban self-custody (But it’s still a big deal)

Okay, let’s address the elephant in the room: Will this law put an end to your beloved self-custodial wallets? Not quite. According to the experts, you can still store your crypto in your own wallet. But if you’re a wallet provider offering services like payments or transfers, well, the law might just give you a little nudge (toward licensing). 😎

Wallet services in UAE

There’s been a bit of confusion, especially from the likes of Mikko Ohtamaa, who’s convinced that this law will lead to the “de facto ban” of crypto and self-custodial wallets in the UAE. But experts like Kokila Alagh and Irina Heaver are here to tell you: “No, no, no.” Just because you can’t operate a wallet for crypto transactions without a license doesn’t mean you’re banned from using one. Phew. 😅

In short, the law may be a headache for businesses, but individuals? You’re still free to use your self-custodial wallet – for now. But if you’re a company in the UAE, time to check if your activities are now under the regulatory microscope. 🧐

“Further clarification from the Central Bank is expected as the law moves through implementation, but for now, individuals remain unaffected while companies should assess whether their activities fall within regulated scope.”

Meanwhile, Ohtamaa had some strong words for UAE lawyers, accusing them of ahem overcomplicating things just to line their pockets. Yikes. 😬

So, to wrap it up: the UAE’s crypto future is officially very regulated. Better get those licenses in order, or you could find yourself paying one heck of a fine. Or worse, being forced to sit through a lawyer’s boring lecture. 😩

Read More

2025-11-25 14:25