UAE Authorities Strengthen Oversight of Web3 Sector
Date: 2025-11-26 Author: Oliver Abernathy Categories: IN WORLD
Federal Decree-Law No. 6 of 2025 has entered into force in the United Arab Emirates, significantly expanding the Central Bank of the UAE's (CBUAE) oversight of the Web3 sector. Violators face large fines of up to AED 1 billion ($272 million) and potential criminal liability. Although the law was only officially published in late November, its provisions will be in effect from September 2025.
The law applies to decentralized protocols (DeFi), cross-chain bridges, decentralized exchanges (DEX), stablecoins, and infrastructure providers. Companies covered by the new regulations must obtain the appropriate license by September 2026 or face significant sanctions.
Articles 61 and 62 of the law list the types of activities that require licensing. These include the provision of payment services involving virtual assets, the storage of digital money, retail payments, and the marketing of licensed financial activities. Article 62 specifies that a license is required for "any person conducting, offering, or facilitating" any supervised financial transaction, regardless of its form.
The law does not prohibit the use of non-custodial crypto wallets, but companies offering payments, transfers, or other financial services must obtain a license, Kokila Alag, managing partner of Karm Legal Consultants, explained to Cointelegraph.
Some experts are critical of the new rules. Mikko Ohtamaa of Trading Strategy noted that this is the first law in the world that extends oversight not only to financial transactions but also to technology providers, effectively restricting the crypto sector in the country. Even if interpreted narrowly—as defined only by "payments," "payment tokens," and "money transfers"—the law covers most cryptocurrency assets, including Bitcoin, as well as interactions with the Ethereum and Solana networks.
According to Ohtamaa, regulating infrastructure, whether wallets or RPC nodes capable of connecting users to the blockchain, could make public blockchains less accessible to the general public.
Previously, the UAE authorities also signed an agreement on the automatic exchange of tax information on cryptocurrencies, highlighting the overall trend toward strengthening oversight of digital assets in the country.
The new law underscores the UAE's commitment to systematically regulate the rapidly growing Web3 industry, protecting users and the financial system, while simultaneously creating strict requirements for businesses and blockchain developers.
