Dubai regulator creates regulatory framework for investment tokens

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The Dubai Financial Services Authority (DFSA) has established a regulatory framework for investment tokens – stock tokens and derivative tokens. Later, it is planned to include cryptocurrencies and stablecoins in it.

According to a statement from the Dubai Financial Services Authority (DFSA), the regulatory framework for share tokens is created to develop the financial environment and meet the demands of market participants. DFSA is an independent financial regulator in Dubai, which is responsible for monitoring and regulating the operation of financial services companies.

According to the WAM news agency, in the DFSA regulatory framework, investment tokens are divided into security tokens or njrtys derivatives (derivative tokens). According to the document, these include: “securities or their derivatives in the form of a cryptographically protected digital representation of rights and obligations that are issued, transferred, stored using DLT or other similar technology.”

The legal framework can be applied to individuals interested in buying, selling and storing investment tokens
and firms that provide financial services related to such assets.

The creation of a new regulatory framework is the first step in addressing the issue of digital asset regulation. The document contains proposals reflected in
Consultative Document 138published in March 2021. In March, the Dubai Financial Services Authority called on members of the public to comment on their proposed rules. The new document specifies the permitted types of investment tokens that can be listed on the digital asset exchange at the Dubai International Financial Center.

The DFSA is working to create a regulatory framework for unlisted securities on the blockchain as well. These will include cryptocurrencies, utility tokens and some stemcoins. The publication of the supplement to the document is scheduled for the fourth quarter of this year.

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