UAE makes Bitcoin wallets a crime risk in global tech crackdown

• UAE Federal Decree No. 6 of 2025 got here into impact on September 16.
• Article 62 locations APIs, explorers and decentralized platforms beneath the management of the Central Financial institution.
• Article 61 regulates all advertising, emails and on-line messages about crypto companies.

In a pointy flip from its crypto-friendly picture, the United Arab Emirates has handed sweeping new laws that classifies primary cryptocurrency infrastructure, together with Bitcoin wallets, as probably prison until licensed by the Central Financial institution.

Authorized consultants at Gibson Dunn have characterised the regulation’s scope as unusually broad and warned that its wording poses important dangers to international know-how suppliers.

This shift, embedded in Federal Legislative Decree No. 6 of 2025, will come into impact from September 16 and may have international implications for builders and platforms providing crypto entry.

The regulation replaces the 2018 Banking Statute and considerably broadens the definition of economic exercise. What units this laws aside is just not solely its scope, but additionally its enforcement mechanisms.

Penalties for non-compliance vary from fines of AED 50,000 to AED 500,000,000 (as much as $136,000,000) and will embody imprisonment.

Importantly, this is applicable not solely to entities working inside the UAE, but additionally to these whose merchandise are accessible from inside the nation.

Licensing now applies to wallets, APIs, and even analytics

Essentially the most consequential aspect of the brand new regulation is present in Article 62. It provides the Central Financial institution management over any know-how that ‘provides, provides, points or facilitates’ monetary actions.

The wording is broad sufficient to incorporate self-custodial wallets, API companies, blockchain explorers, analytics platforms, and even decentralized protocols.

This marks a elementary change in the way in which crypto infrastructure is regulated within the UAE.

Beforehand, licensing necessities targeted on conventional monetary entities, however the up to date framework shifts this focus to software program and knowledge instruments.

In line with builders’ evaluation, even public instruments like CoinMarketCap and open-source Bitcoin wallets now require licenses to stay accessible inside the UAE.

For the primary time, builders can face prison fees for providing unlicensed crypto instruments, even when they’re based mostly overseas.

This growth of jurisdiction indicators a brand new regulatory posture that treats entry to crypto as strictly as its possession or change.

Communications and advertising are actually topic to regulation

The crackdown doesn’t cease on the monetary infrastructure. Article 61 of the identical regulation defines the advertising, promotion or promoting of economic companies as an exercise requiring a allow.

In apply, which means merely internet hosting an internet site, publishing an article or sharing a tweet about an unlicensed crypto service might be thought of a authorized violation if that content material reaches UAE residents.

This modification dramatically will increase the compliance footprint for corporations and builders.

Gibson Dunn emphasizes that these provisions considerably increase the enforcement perimeter, particularly for corporations that do not need a proper presence within the UAE.

The regulation applies to communications that originate from outdoors the nation however are accessible inside it.

The result’s a regulatory panorama by which builders, content material creators and infrastructure suppliers should weigh whether or not their platforms might be not directly accessed by customers within the UAE.

In lots of instances, avoiding authorized publicity may end up in disabling entry or stopping service altogether.

Dubai’s free zones now not defend crypto companies

In recent times, the UAE has positioned itself as a hub for blockchain innovation.

Jurisdictions resembling Dubai’s Digital Property Regulatory Authority (VARA) and Abu Dhabi International Market (ADGM) attracted international consideration with purpose-built crypto licensing frameworks.

Nevertheless, the brand new federal regulation abolishes these free zone preparations, sustaining the Central Financial institution’s management over the complete nation.

The federal regulation replaces all rules launched by the UAE’s free zones, successfully ending the regulatory arbitrage that after attracted corporations to Dubai.

The broader context contains the nation’s historical past of digital restrictions.

For instance, WhatsApp voice calls stay blocked within the UAE, reinforcing a constant coverage method to centralized management over communications and digital instruments.

Whereas this will likely convey the UAE nearer to worldwide stress from teams just like the Monetary Motion Job Drive, it additionally places crypto service suppliers in a tough place.

In different jurisdictions going through related pressures, corporations have retreated totally to keep away from enforcement danger.

Enforcement will start in 2026 and additional rules are anticipated

Entities have one 12 months from September 16, 2025 to adjust to the rules. This grace interval could also be prolonged on the discretion of the Central Financial institution.

Throughout this era, it’s anticipated that additional rules will make clear how these common guidelines can be utilized in apply.

However, the scope of the regulation is already inflicting concern.

The language surrounding facilitation and communication, mixed with the tough penalties beneath Article 170, means that corporations providing crypto devices globally should now think about the chance of incidental publicity to UAE customers.

For software program builders and platform operators, this represents a major departure from the norms of decentralized entry and open supply innovation.