In a landmark decision, the Dubai Court of First Instance has officially recognized cryptocurrency payments for salaries under employment contracts.
This ruling was announced by the Wasel & Wasel law firm, highlighting a notable shift in the judicial perspective towards crypto assets.
This ruling comes as a direct contrast to a previous judgment from the same court in 2023, where a similar case was dismissed due to the plaintiff’s inability to provide an exact valuation of the cryptocurrency involved.
The latest case arose when an employee, claiming wrongful termination and unpaid wages, had an employment contract stipulating a salary in traditional fiat currency along with an additional 5,250 EcoWatt tokens, a cryptocurrency.
The employer contested the enforceability of the crypto salary payments, leading to the court’s examination of the issue.
In a surprising turn, the court sided with the employee, validating the payment in cryptocurrency and ordering the employer to pay the salary in EcoWatt tokens instead of converting it to fiat currency.
This decision sets a powerful precedent, reinforcing the idea that cryptocurrency can be considered a legitimate form of remuneration in employment agreements.
The ruling coincides with Dubai’s ambition to establish itself as an international hub for crypto and digital assets. The city has introduced a comprehensive regulatory framework tailored for digital-asset companies, promoting innovation while ensuring compliance.
The Dubai International Financial Centre (DIFC) has emerged as a crucial economic free zone where businesses can operate with reduced bureaucratic constraints, further enhancing the city’s appeal in the fintech and cryptocurrency sectors.
“This ruling marks a significant shift in the court’s approach, demonstrating a greater acceptance of cryptocurrency as a valid and enforceable means of remuneration,” stated Wasel & Wasel. The law firm emphasized the importance of upholding clear contractual agreements, provided they are mutually accepted and aligned with existing laws.
Legal experts predict that this ruling will encourage increased integration of cryptocurrencies into various sectors beyond employment, potentially impacting how businesses and individuals conduct financial transactions in the UAE and beyond.
