Dubai International Financial Centre Advances Digital Asset Laws
Summary:
Dubai International Financial Centre (DIFC) has introduced a new digital assets and security law and updated existing legislation to adapt to global trade and financial market changes. Aimed at offering legal certainty to users of digital assets, the legislation reportedly includes an update making electronic records equivalent to their paper versions. Alongside this, DIFC updated its cryptocurrency regulations in 2022 and began offering subsidies to AI and Web3 firms in 2023. It also documented a net profit of $203 million in 2023, marking a 45% increase from the previous year.
Dubai International Financial Centre (DIFC), an economic hub with more than 5,000 inhabitants, is introducing a novel digital assets and security law, while revising the existing legislation. The centre operates under its own regulations, that draw from English law. The aim of these legislative adjustments is to maintain stride with quick changes in global trade and financial markets and to offer investors and users of digital assets legal surety, as per an official announcement. DIFC Authority's Chief Legal Officer, Jacques Visser, acknowledged this new legislation as revolutionary for its comprehensive legal description of digital assets from the perspective of property law. The new Digital Assets Law comprises seven pages of text along with appendices. At the time of reporting, an updated law that amends at least six prior laws for digital assets has been passed, but it's not publicly accessible online yet. DIFC, in its announcement, highlighted the alteration to the Law of Obligations, which has effectively equated electronic records to paper. XRP and TON received authorisation in the Dubai International Financial Centre's free trade region, as per a related news. The much larger Security Law 2024, supersedes a law from 2005 and its amendment in 2019, and includes the Financial Collateral Regulations into its text. The new law is crafted after the United Nations Commission on International Trade Law's Model Law on Secured Transactions, aligning it with international best practices, pointed out DIFC. In 2022, the DIFC modified its regulations regarding cryptocurrencies. It began offering subsidies to Web3 and artificial intelligence companies for licenses in 2023. The centre reported a net profit of $203 million in 2023 which represents a rise of 45% from the previous year. New registrations also increased by 34% during that year, including a greater influx of hedge funds and businesses from Europe and the US. Although the new Digital Assets Law claims singularity, it is not the first jurisdiction to legally define cryptocurrency as property. Courts in China, Hong Kong, and Singapore made similar rulings concerning digital assets as property, last year.
Published At
3/15/2024 11:41:30 PM
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