UAE’s new financial law pulls DeFi and Web3 into regulatory scope
NegativeCryptocurrency
- The UAE has enacted Federal Decree Law No. 6, which expands the regulatory authority of the UAE central bank over decentralized finance (DeFi) and Web3, effectively ending the 'just code' defense and introducing penalties that could reach $272 million. This law aims to bring more oversight to the rapidly evolving cryptocurrency sector.
- This development is significant as it marks a shift in the regulatory landscape for DeFi and Web3 in the UAE, potentially impacting innovation and investment in these sectors. By imposing stricter regulations, the UAE central bank seeks to enhance consumer protection and financial stability.
- The introduction of this law comes amid a turbulent period for the DeFi sector, which has recently experienced substantial losses, highlighting the volatility and risks associated with cryptocurrency investments. Additionally, as traditional financial institutions like HSBC prepare to launch tokenized deposits, the regulatory environment is becoming increasingly crucial for balancing innovation with risk management in the cryptocurrency market.
— via World Pulse Now AI Editorial System
