UAE Expands Crypto Regulation With Sweeping DeFi Framework
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The UAE has introduced a major legal update that brings decentralized finance and Web3 services under direct Central Bank supervision.
Federal Decree Law No. 6 of 2025 – in effect since Sept. 16 – expands the definition of regulated financial activity to include crypto payments, trading, custody, lending, and other digital-asset services.
According the information lawyer Irina Heaver said the shift is one of the most significant regulatory moves in the region and urged projects to prepare before the September 2026 transition deadline.
DeFi Projects No Longer Outside Regulatory Scope
Articles 61 and 62 state that any entity offering financial services “through any means or technology” must be licensed. This eliminates the long-standing “just code” defense used by DeFi developers.
Protocols supporting stablecoins, RWAs, DEX tools, bridges, or liquidity routing may now require licensing, with penalties for non-compliance reaching up to 1 billion dirhams ($272 million).
Self-Custody Remains Allowed
The law does not restrict individuals from using self-custodial wallets, according to Kokila Alagh of Karm Legal. Only companies offering wallet software that enables regulated services may fall under the new rules.
She noted rising industry confusion and said clarification from the Central Bank is expected, though no date has been set.
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