New UAE Sweeping Banking Decree Looks to Cement Country’s Global Crypto Position

Core Viewpoint - The United Arab Emirates has enacted a new central bank law that integrates digital assets and decentralized finance (DeFi) into traditional banking regulations, positioning the country as a global financial innovation hub [1]. Regulatory Framework - The new law, enacted in September and made public recently, imposes fines for unlicensed operations up to 1 billion dinars ($272 million) and mandates that all crypto and blockchain organizations operating in or from the UAE must be licensed by the Central Bank of the UAE (CBUAE) [2]. - Federal Decree Law No. 6 of 2025 introduces comprehensive reforms that bring virtual assets, DeFi protocols, stablecoins, tokenized real-world assets, decentralized exchanges, wallets, bridges, and all supporting blockchain infrastructure under the authority of the central bank [3]. Innovation and Compliance - The law aims to foster innovation by providing a 60-day licensing decision process, risk-based capital rules, and a one-year grace period (until September 2026) for existing players to achieve compliance [4]. - New licensable categories include virtual asset payments, open finance, and digital wallets, with enhanced fraud protections and fast-track dispute resolution for amounts up to AED 100,000, creating opportunities for Islamic DeFi and tokenized Sukuk [5]. Global Positioning - While Europe is still rolling out its Markets in Crypto-Assets (MiCA) regulation, the UAE has established one of the most comprehensive national frameworks that treats digital assets as a core component of the financial system [6].