Dubai Employers Authorized to Pay Salaries with Cryptocurrencies

In a groundbreaking ruling, employers in Dubai are now permitted to pay employee salaries using cryptocurrencies, following a decision made by the Dubai Court of First Instance on July 24, 2025. This ruling represents a significant evolution in the legal framework governing employment contracts in the United Arab Emirates (UAE). Previously, courts had maintained that salary payments in cryptocurrencies could not be enforced due to the absence of a reliable mechanism for converting the value of these digital assets into fiat currency. The court’s latest decision, rooted in the UAE Civil Transactions Law and Federal Decree-Law No. 33 of 2021, allows employers to stipulate cryptocurrency payments directly in employment contracts without the necessity of conversion to traditional currency.

The implications of this ruling are multifaceted. Marie Chowdhry, a partner at Pinsent Masons in Dubai, noted that this decision could encourage a broader adoption of digital currencies across various sectors, aligning with the UAE's ambitions to become a leader in technological innovation. Chowdhry stated, “This ruling could pave the way for the expansion of the application and use of digital currencies in different fields, which supports the vision of the UAE to be a regional, if not global, powerhouse for innovation and use of new technologies.”

Luke Tapp, also a partner at Pinsent Masons, emphasized the importance of clarity in employment contracts under this new legal landscape. He remarked, “The judgment reinforces the idea that contractual provisions in employment contracts should be precise. Employers should ensure that any mode of payment used in the contract, whether fiat or cryptocurrency, is clearly stated and understood.”

This ruling comes at a time when the UAE is actively seeking to bolster its status as a hub for cryptocurrency and blockchain technology. According to a report by the Dubai Multi Commodities Centre (DMCC), the emirate has seen a 32% increase in the number of companies involved in the crypto sector from 2022 to 2023.

The court’s decision also raises questions about the potential for future challenges. Chowdhry cautioned that while the ruling is significant, it may be subject to appeal in higher courts, which could alter its enforcement. “This is certainly an area to watch closely; this judgment was given in the Dubai Court of First Instance and therefore may be challenged by a higher court. Typically, we look to judgments made in the Court of Cassation as final,” she noted.

Critics of the ruling argue that the volatility associated with cryptocurrencies poses risks for both employers and employees. Dr. Samuel Carter, an economist at the University of Dubai, expressed concerns regarding the potential fluctuations in cryptocurrency values. “While this ruling opens new avenues for salary payments, the inherent instability of cryptocurrencies could lead to significant discrepancies in employee earnings, which must be carefully managed,” he stated.

As the use of cryptocurrencies in salary payments becomes a reality in Dubai, the ruling presents a critical juncture for businesses navigating the evolving financial landscape. Employers will need to adopt comprehensive strategies to address the challenges and opportunities presented by this innovative payment method.

In summary, the Dubai Court of First Instance’s ruling to allow salary payments in cryptocurrencies marks a pivotal moment in the UAE's legal and economic framework. As the region continues to embrace digital transformation, the implications of this decision will likely reverberate across various sectors, influencing employment practices and economic strategies for years to come.