DFSA Issues Consultation Paper No. 168: Enhancements to Crypto Token Regulation

The Dubai Financial Services Authority (DFSA) has released Consultation Paper No. 168 (CP 168), seeking public feedback on proposed enhancements to its regulatory framework governing crypto tokens within the Dubai International Financial Centre (DIFC). The consultation aims to refine and strengthen the existing regime, addressing evolving market dynamics and aligning with global regulatory developments.

Key Proposals in CP 168

The consultation paper outlines several significant proposals:

• Incorporation Requirements: The DFSA proposes that all entities intending to offer financial services related to crypto tokens must establish a corporate presence within the DIFC. This measure aims to ensure that only entities incorporated under DIFC law can provide such services, enhancing regulatory oversight and accountability.
• Enhanced Regulatory Requirements: CP 168 introduces more stringent regulatory requirements for entities dealing with crypto tokens. These include updated provisions in the DFSA's Rulebook modules, such as the General (GEN) module, Conduct of Business (COB) module, Collective Investment Rules (CIR) module, Fees (FER) module, Authorised Market Institutions (AMI) module, Market (MKT) module, and the Glossary (GLO) module.
• Focus on Financial Crime and Custody: Building upon previous regulations, the DFSA emphasizes the need for robust measures against financial crime and enhanced custody standards. The consultation reflects the DFSA's commitment to evolving its policies in response to supervisory experiences and international regulatory developments.

Stakeholder Engagement

The DFSA invites comments from a broad range of stakeholders, including:

• Authorised Market Institutions (AMIs): Entities wishing to admit crypto tokens to trading, clearing, or settlement on their platforms.
• Operators of Alternative Trading Systems (ATS): Platforms intending to allow trading of crypto tokens.
• Custodians and Third-Party Agents: Organizations responsible for safeguarding and administering crypto tokens.
• Financial Service Providers: Firms offering services such as dealing in, advising on, or arranging transactions related to crypto tokens.
• Issuers and Creators of Crypto Tokens: Entities involved in the creation and issuance of crypto tokens.
• Technology and Service Providers: Companies offering technology support, as well as legal, accounting, audit, or compliance services to the aforementioned entities.

Next Steps

Stakeholders are encouraged to submit their comments on the proposals outlined in CP 168 by October 31, 2025. Following the consultation period, the DFSA will review the feedback and finalize the amendments to the regulatory framework. The updated regulations will be published on the DFSA's website, and a notice will be issued to inform the public of the changes.

For more details and to access the full consultation paper, visit the DFSA's official website: https://www.dfsa.ae/news/notice-consultation-paper-release-cp-168.