Dubai’s financial regulator made several amendments to the legal regime for using cryptocurrencies within the Dubai International Financial Centre (DIFC). The initiative touches on several areas of digital asset use and aims to improve the regulatory framework for tokens in the special economic zone.

DFSA Simplifies the Regulation of Cryptocurrencies in DIFC Territory

The Dubai Financial Services Authority (DFSA) announced amendments to the legal framework governing crypto-asset use, published in January 2024 and applied within the DIFC, Dubai’s special economic zone.

The amendments affect several areas of digital asset use:

  1. Investment funds. The regulator lifted strict restrictions for investment funds, which prohibited them from investing in crypto tokens that aren’t on the list of “authorized” ones. Domestic funds were allowed to invest in “unrecognized” cryptocurrencies, provided that the volume of investments didn’t exceed 10% of the gross asset value of the fund (GAV). The “authorized” tokens list includes BTC, ETH, LTC, XRP, and TON.
  2. Stablecoin listings. The DFSA lowered the fee value that stablecoin issuers must pay the regulator when applying for authorization to use it within the DIFC. The fee was previously $10,000 and was lowered to $5,000. Other requirements of the DFSA for issuers of stablecoins remachanged.

According to Ian Johnston, ex-Director of the DFSA, the initiative’s primary goal is to stimulate innovation while maintaining a transparent regulatory regime.

The new rules regarding digital assets came into force on the Dubai International Financial Center (DIFC) territory in March 2024.

Author: Nataly Antonenko
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