In a change of position towards cryptocurrencies, the Dubai Court of First Instance has recognized these digital assets as means of payment for salaries.

With this decision, the judicial body shows a shift towards a progressive change with respect to cryptocurrencies in the United Arab Emirates, where until 2023 they were considered to lack a precise valuation.

This was stated by Irina Heaver, partner at the United Arab Emirates law firm NeosLegal, who referred to “the ruling in case number 1739 of 2024” in comparison to the situation a year ago.

According to Heaver, in the case an employee had filed a lawsuit “alleging that the employer had not paid his wages, wrongful dismissal compensation and other benefits. The worker’s employment contract stipulated a monthly salary in fiat and 5,250 in EcoWatt tokens. “The litigation has its origins in the employer’s inability to pay the token portion of the employee’s salary within six months.”

In reference to the litigation, it is important to note that last year the court recognized the inclusion of EcoWatts tokens in the contract. However, it was indicated that the payment was not made in cryptocurrencies since the worker “did not provide a clear method to value the currency in fiduciary terms.”

Inclusive salary approach on the path to the digital economy

Heaver clarified that in 2024, the court ordered the payment of the crypto salary according to the employment contract without converting it into fiat. “This decision reflects broader acceptance of cryptocurrencies in employment contracts and highlights the court’s recognition of the evolving nature of financial transactions within the Web3 economy.”

The lawyer also stressed that the court’s reliance on the UAE Civil Transactions Law and Federal Decree-Law No. 33 of 2021 in the two rulings is an example of the consistent application of legal principles in determining salaries.

With this precedent, it is possible to foresee an increase in the adoption of digital assets in everyday financial transactions in the UAE, with a more inclusive and innovative salary approach, strengthening the legitimate right of employees to pay their income in fiat or cryptocurrencies, according to the current legal framework.

M.Pino

Source: cointelegraph

(Reference image source: Unsplash+, in collaboration with Getty Images)

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La entrada Dubai recognized cryptocurrencies as valid salary payment apareció primero en Bitfinance.