 extends oversight to decentralized finance and broader Web3 activities.){kind=link}
Decentralised finance (DeFi) and wider Web3 will be included in the legislative framework of a new financial legislation in the United Arab Emirates, marking a significant change for the sector.
Federal Decree regulation No. 6 of 2025, the UAE’s new central bank regulation, brings about “one of the most consequential regulatory shifts” for the region’s cryptocurrency sector. NeosLegal founder and local cryptocurrency lawyer Irina Heaver said.
DeFi and Web3 in regulations
“It brings protocols, DeFi platforms, middleware, and even infrastructure providers into scope if they enable activities such as payments, exchange, lending, custody, or investment services,” Heaver said.
The attorney advises businesses constructing or conducting business in the United Arab Emirates to see this as a crucial regulatory milestone and to synchronise their systems before the September 2026 transition date.
The UAE’s Federal Decree Law No. 6, which was published in the Official Gazette and went into effect on September 16, 2025, is a central bank law that governs financial institutions, the insurance industry, and activities pertaining to digital assets.
Cryptocurrency payments and digital stored value are among the activities included in its main provisions, Article 61 and Article 62, which call for a license from the Central Bank of the UAE (CBUAE).
“Article 62 states that any person who carries on, offers, issues, or facilitates a licensed financial activity ‘through any means, medium, or technology’ falls under the regulatory perimeter of the CBUAE,” Heaver said.
No longer out of regulations
In actuality, this implies that DeFi initiatives can no longer evade regulation by arguing that they are “just code,” the attorney stated, adding that a protocol’s compliance is not exempted by the claim of “decentralisation.”
According to Heaver, protocols that provide stablecoins, real-world assets (RWA), decentralised exchange (DEX) features, bridges, or liquidity routing “may require a license.” She said that enforcement is already in place and that unauthorised activities may result in fines of up to 1 billion dirhams ($272.3 million) as well as possible criminal consequences.
According to Kokila Alagh, founder and managing partner of Karm Legal Consultants, bitcoin wallet providers are likely to be impacted by the UAE’s new central bank rule, as it directly relates to offering “stored value services.”
Alagh claims that there has been a “fair bit of confusion” over the law’s impact on non-custodial wallets, or self-custody wallets, which are intended to allow users to keep their assets apart from third parties.
Community chips in
Alagh and Heaver stated that the rule does not amount to a “de facto ban” of cryptocurrency and self-custodial wallet software in the United Arab Emirates, despite suggestions made by certain industry analysts, such as Mikko Ohtamaa of Trading Strategy.
“The law does not ban self-custody, nor does it restrict individuals from using their own wallets,” Alagh said, saying that it “simply expands” the regulatory diameter for companies. Alagh noted that Karm Legal has had a lot of inquiries about the matter.
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