UAE Central Bank Seizes Control of DeFi: Fines Hit $272M
The United Arab Emirates has effectively outlawed the "just code" defense. Under Federal Decree Law No. 6 of 2025, enacted this week, the Central Bank of the UAE (CBUAE) now holds absolute regulatory authority over all digital asset activities, including DeFi protocols, stablecoins, and decentralized exchanges.
The Hammer: $272 Million Penalties
The new framework is not a suggestion. Unlicensed operators face fines up to 1 billion dirhams ($272 million). The law explicitly targets the entire stack—protocols, middleware, and infrastructure providers are now fair game if they facilitate payments, lending, or custody.
Irina Heaver, founder of NeosLegal, confirmed the sweeping scope.
"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."
"Code is Law" Overruled
For years, DeFi projects operated in grey areas, claiming autonomy via smart contracts. That ends now. The decree mandates that any entity offering financial services—regardless of technology—must secure a CBUAE license.
"With the new federal law now in force the UAE has effectively redrawn the regulatory perimeter around digital assets," Marina D'Angelo, head of Europe at DLT Law, noted.
The Clock Starts Now
Existing businesses have a one-year grace period. By September 2026, every crypto entity operating in or from the UAE must be fully licensed or face the 1 billion dirham hammer. The result? A forced maturity for the region's crypto hub ambitions—comply or get out.
