UAE Passes New Law to Regulate Digital Assets and DeFi Operations

TLDR

• The UAE has enacted a new law that regulates digital assets and decentralized finance under the Central Bank’s oversight.
• All cryptocurrency and blockchain firms operating in the UAE must obtain a license from the Central Bank of the UAE.
• The law introduces fines of up to 1 billion dinars for unlicensed operations within the country.
• New licensing categories include virtual asset payments, open finance, and digital wallets to ensure compliance.
• Existing firms have until September 2026 to comply with the new regulations and obtain the required licenses.

The United Arab Emirates (UAE) has passed a new central bank law that brings digital assets and decentralized finance (DeFi) under its regulatory framework. Enacted in September, the law requires all cryptocurrency and blockchain firms operating within the country to obtain a license from the Central Bank of the UAE (CBUAE). Violators may face fines of up to 1 billion dinars, approximately $272 million.

UAE’s New Law Expands Central Bank’s Authority

The Federal Decree Law No. 6 of 2025 introduces major changes to the UAE’s financial sector. The law now includes virtual assets, DeFi protocols, stablecoins, tokenized assets, decentralized exchanges, and blockchain infrastructure under CBUAE’s supervision. This move aims to regulate the growing digital asset industry while ensuring its integration with the traditional financial system.

Under the new law, all entities operating in these areas, regardless of the technology used, must be licensed. The law mandates a 60-day timeline for licensing decisions, establishing a faster approval process. Existing firms will have until September 2026 to comply with the new regulations.

Licensing and Compliance Requirements

The law introduces new categories for licensing, including virtual asset payments, open finance, and digital wallets. It also strengthens protections against fraud, providing a fast-track dispute resolution system for cases up to AED 100,000.

Shari’ah governance will also play a role in regulating Islamic DeFi and tokenized Sukuk, which are blockchain-based Islamic bonds. This development may help position the UAE as a hub for Islamic finance innovation in the digital space.

The UAE has taken a proactive approach to creating a legal framework that supports digital asset innovation while maintaining robust financial oversight. The introduction of these new regulations reflects the country’s ambition to be at the forefront of financial technology advancements.

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