New UAE Regulations May Prohibit Crypto Payments, Says Blockchain Lawyer

The United Arab Emirates (UAE) may be on the brink of banning crypto payments, according to crypto and blockchain lawyer Irina Heaver. Newly-released regulations by the Central Bank of the UAE (CBUAE) suggest that payment tokens in the country must be backed by UAE dirhams and cannot be linked to other currencies, potentially prohibiting the acceptance of cryptocurrencies for goods and services.

Heaver expressed concerns about the impact of these regulations on the country’s pro-commerce and pro-investment stance, noting that historically, the UAE has thrived on foreign direct investment due to its liberal policies. She also highlighted the potential negative effects on the country’s image and ambitions in the digital economy.

Furthermore, Heaver pointed out the lack of industry representation in the UAE compared to associations like the Crypto Valley Association in Switzerland. She emphasized the importance of having a united voice to advocate for the interests of the Web3 and crypto industry and counter policies that may hinder its growth.

With Tether (USDT) being a key player in crypto transactions, Heaver believes that the new regulations could hinder the progress of the sector in the UAE. The absence of stablecoins in transactions may signal a less favorable environment for the crypto industry, potentially impacting foreign investment inflow and the country’s digital economy ambitions.

As the UAE navigates these new regulations, the need for stronger industry representation and advocacy becomes increasingly apparent to ensure the growth and development of the Web3 and crypto sector in the country.