Dubai continues to lead in crypto regulation.
The Dubai International Financial Centre (DIFC) has recognized two additional cryptocurrencies, Ripple's XRP and TON, for use within its special economic zone. This brings the total number of approved cryptocurrencies to five, joining Bitcoin, Ethereum and Litecoin which were previously greenlit.
The new designations will allow over 4,000 financial institutions and companies located in the DIFC to utilize XRP and TON for transactions and services.
“It’s refreshing to see the DFSA encourage the adoption and use of digital assets such as XRP to position Dubai as a leading financial services hub intent on attracting foreign investment and accelerating economic growth,” said Brad Garlinghouse, CEO of Ripple.
The DIFC is governed by the Dubai Financial Services Authority (DFSA), which instituted crypto regulations in October 2021. In September 2022, the DFSA proposed a new Digital Assets Law which would establish a legal framework for digital assets regarding ownership, control and transfer. A revamped Law of Security has also been proposed to modernize regulations around collateral.
The moves are the latest in Dubai's push to become a global leader in crypto adoption and regulation. In March 2022, the Dubai Virtual Asset Regulatory Authority was formed to oversee crypto activities across Dubai, while the Abu Dhabi Global Market recently implemented Distributed Ledger Technology (DLT) regulations.
Ripple opened its regional headquarters in DIFC in 2020, citing strong demand in the Middle East and North Africa region which accounts for 20% of its business. The company expects the new recognition of XRP to spur further growth.
The DFSA indicated that additional proposals around crypto custody, staking, financial crime and fund management are forthcoming as it continues developing its virtual asset framework. The economic zone has already received inquiries from over 100 interested firms since regulations were introduced last year.
