Dubai Financial Services Authority Adds XRP and Toncoin to its Recognized Cryptocurrency List
Summary:
The Dubai Financial Services Authority (DFSA) has added XRP and Toncoin to its list of recognized cryptocurrencies, joining Bitcoin, Ether, and Litecoin. This addition enables financial firms in the Dubai International Financial Centre (DIFC) to handle transactions involving these tokens. The DFSA, which regulates the DIFC, has been formulating crypto regulations since October 2021, with further enhancements in November 2022. A proposed Digital Assets Law and an updated Law of Security, inspired by the United Nations Commission on International Trade Law’s secured transactions model, are under discussion. This is in line with Dubai's regulators' pro-innovation approach aiming to establish Dubai as a leading financial hub. Concurrently, the Abu Dhabi Global Market introduced Distributed Ledger Technology (DLT) Foundations Regulations. In March 2022, the Dubai Virtual Asset Regulatory Authority was established to oversee all free-trade zones, excluding the DIFC.
On November 2nd, the Dubai Financial Services Authority (DFSA) expanded its roster of recognized tokens, adding XRP (XRP) and Toncoin (TON). They now stand alongside Bitcoin (BTC), Ether (ETH), and Litecoin (LTC) as acknowledged by the Dubai International Financial Centre (DIFC). These tokens' newfound status permits financial firms within the DIFC to process transactions involving them. Over 4,000 companies operate within this designated financial zone. Ripple set up its MENA headquarters in the DIFC in 2020. The organization reveals that approximately 20% of its clients are situated in this area. Ripple's CEO, Brad Garlinghouse, expressed his praise for the DFSA's efforts to promote the use and acceptance of virtual assets like XRP to establish Dubai as a top-tier financial services destination, intending to lure in foreign investment, and thereby speed up economic growth.
The DFSA, tasked with regulating the DIFC, initiated cryptocurrency regulations in October 2021 and further enhanced these regulations in November 2022. In late September, a projected Digital Assets Law was declared by the DIFC. This also involved revoking the erstwhile 2005 Law of Security and the Financial Collateral Regulations and replacing them with an updated Law of Security that incorporated these collateral regulations.
Proposed changes to the digital assets law clarify its legal nature, its proprietary aspects, the procedures around its control, transfer, and interactions by concerned parties. As per Dubai VARA's 'initial approval' to crypto company WadzPay, the new Security Law would take inspiration from the United Nations Commission on International Trade Law's secured transactions model, albeit with some modifications. Consultations around these laws will be in progress until November 5th.
In aligning with their consistent pro-innovation stance, Dubai's regulators recently announced this development. Ripple also plans to redouble its efforts in areas where crypto regulations are clearly defined, reasoning that RippleSwell will be hosted in Dubai.
This announcement corresponds with Abu Dhabi Global Market's successful enactment of Distributed Ledger Technology (DLT) Foundations Regulations, which came into being on November 1. As for Dubai, the emirate established the Dubai Virtual Asset Regulatory Authority in March 2022, bestowing it with jurisdiction over the entire emirate and its free trade zones, excluding the DIFC. A virtual assets law was implemented concurrently in the emirate.
Published At
11/2/2023 7:32:57 PM
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