The United Arab Emirates (UAE) has introduced a significant regulatory framework for cryptocurrency and decentralized finance (DeFi) through a new central bank law. Federal Decree Law No. 6 of 2025, which was signed in September and unveiled this week, establishes a licensing requirement for all digital asset and blockchain entities operating within or from the nation.
The new legislation empowers the UAE Central Bank (CBUAE) to oversee a wide array of crypto operations. This includes not only traditional financial institutions but also platforms involved in issuing stablecoins, decentralized exchanges (DEXs), lending services, and tokenized real-world assets. The law aims to extend regulatory reach, ensuring compliance across the diverse landscape of digital finance.
Marina D”Angelo, head of Europe at DLT Law, commented on the implications of this law, stating that the UAE has effectively redefined the regulatory landscape for digital assets. She noted that while it is early to determine the law”s impact on the UAE”s ambition to be a global crypto hub, it significantly alters the compliance framework for those involved in financial services using digital assets.
Under the new regulations, any entity offering financial services through digital assets must secure a license from the CBUAE. This includes decentralized platforms and middleware providers that facilitate payments or tokenization. The law also introduces the principle that operating on open-source protocols does not exempt entities from the licensing requirements, emphasizing that all players in the market must adhere to the established regulatory framework.
Entities currently operating in the UAE have a one-year grace period to comply with the new licensing rules, which will be fully enforceable by September 2026. During this transition, any unlicensed activities could face severe penalties, including fines reaching up to 1 billion dirhams, approximately $272 million.
In conjunction with these regulatory developments, the UAE recently launched the mBridge platform, a cross-border central bank digital currency (CBDC) initiative aimed at facilitating international payments. This platform marks a significant step in the UAE”s strategy to enhance its financial infrastructure and position itself as a leader in the global digital finance arena. The successful deployment of mBridge demonstrates the UAE”s commitment to leveraging blockchain technology for efficient financial transactions.
As the regulatory landscape evolves, the UAE”s approach could serve as a model for other countries looking to establish clear guidelines for the burgeoning cryptocurrency and DeFi markets. The full impact of these regulations will unfold in the coming years, as the nation positions itself within the global financial ecosystem.
