Market News

UAE's New Regulations Raise Concerns Over Bitcoin Ownership and Self-Custody

The United Arab Emirates (UAE) has enacted a new law that significantly alters the landscape for cryptocurrency operations, sparking fears of a de facto Bitcoin ban.

Effective September 16, the Central Bank law imposes stringent licensing requirements that could criminalize the offering of essential crypto tools like Bitcoin wallets without authorization.

These changes, highlighted in the Federal-Decree Law No. 6 of 2025, have raised urgent questions regarding Dubai's reputation as a leading global crypto hub.

Legal experts warn that penalties for non-compliance could include hefty fines up to $136 million and imprisonment, effectively constraining financial activities related to cryptocurrencies.

One of the most striking implications is the classification of self-custody wallets and blockchain explorers as restricted financial products, requiring licensing from the Central Bank.

Under the new regulations, even external entities that enable such services for UAE residents may face legal repercussions.

The law's advertising provisions further complicate matters by regulating any promotions or communications about unlicensed financial activities within the UAE.

Despite previous efforts to position the UAE as a favorable environment for crypto innovation, this law suggests a return to tighter regulatory controls.

With a one-year compliance timeline, there is growing concern that developers and exchanges may limit or withdraw services for UAE users to mitigate inherent risks.

As the UAE prepares to release further regulations, the crypto community is closely monitoring these developments and their potential impact on the market.