Dubai regulator to develop cryptocurrency framework

Dubai Financial Services Authority (DFSA) has announced plans to draw up a regulatory framework for the UAE's nascent cryptocurrency sector.

Few of the plans details have been released at this stage. However it is understood the new regulations, likely to come into effect in 2022, will cover all digital assets and cryptocurrencies.  

The DFSA oversees inancial services firms registered in Dubai International Financial Centre (DIFC), a burgeoning freezone in the city.

The proposed rules will be based on the results of consultation papers, which are due to be distributed this year, according to reports.. 

In a statement the DFSA said it will be creating "a regulatory regime for digital assets (such as tokenized securities and crypto-currencies)." 

"The DFSA is committed to remain 'open for business' with respect to innovation in the financial services sector and we continue to explore how our regulatory regime can accommodate new and innovative business models."

Peter Smith, head of strategy, policy and risk at the DFSA, told Abu Dhabi's The National: "We will look to regulate a wide range of digital assets, including security tokens, utility tokens, the various types of exchange (or payment) tokens, such as cryptocurrencies [and] the firms that provide relevant services in these markets."

"We will regulate these markets in a proportionate and thoughtful manner, drawing on best practices across the globe."

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