Dubai Is the Latest Government To Roll Out Crypto Law, Set Up Regulator

The emirate’s latest digital asset law proposal excludes NFTs and CBDCs

article-image

Sheikh Mohammed bin Rashid Al Maktoum, Dubai ruler | Source: Shutterstock

share

key takeaways

  • Dubai Financial Services Authority reveals report on crypto token regulation
  • Proposal calls for “privacy tokens” and “algorithmic tokens” to be banned

Dubai has revealed its first cryptocurrency legislation, overseen by a new regulatory agency.

“The future belongs to whoever designs it,” Dubai ruler Sheikh Mohammed bin Rashid Al Maktoum wrote in a tweet Wednesday, translated to English. “Today, through the virtual assets law, we seek to participate in the design of this new and rapidly growing global sector. Our step is a leap towards the future aimed at developing this sector and protecting all investors in it.” 

The 56-page proposal, released by the Dubai Financial Services Authority (DFSA) Wednesday, focuses on crypto tokens and follows an October report on digital tokens.

The proposed law focuses on “crypto tokens,” which does not include non-fungible tokens (NFTs), central bank digital currencies (CBDCs) and utility tokens, including play-to-earn gaming tokens with “non-financial” uses.

“We are proposing to exclude NFTs from the scope of our current proposals on the basis there is no Financial Service being provided,” the report said. “However, this comes with a strong caveat that this exemption will depend on the characteristics of the NFT and its function, and not what terminology or marketing terms are used.”

The Dubai Virtual Asset Regulation Law calls for the ban of “privacy tokens,” designed to obscure token holders and trading patterns, and “algorithmic tokens,” which interfere with supply and demand to control price.

The proposal is currently in the public consultation and amendment phase. The next step is to submit it to higher government authorities for approval.

The final version of the law will be made public once it is complete.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward Guidance newsletter.

Get alpha directly in your inbox with the 0xResearch newsletter — market highlights, charts, degen trade ideas, governance updates, and more.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Javits Center North | 445 11th Ave

Tues - Thurs, March 18 - 20, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Flashnote Template Presentation (2).jpg

Research

With the recent election, it’s clear that there will be a meaningful shift in crypto regulations and legislation. Trump is likely as pro-crypto as a president can be. He launched (multiple) of his own NFT collections and is launching an Aave wrapper called World Liberty Fi. He has also spoken out and mentioned that he wants to make the United States "the crypto capital of the planet" and transform it into the "Bitcoin superpower of the world". He proposed creating a strategic national Bitcoin stockpile alongside support from Senator Cynthia Lummis, promising to retain 100% of all Bitcoin held by the U.S. government. More importantly, we’re likely to see deregulation across the board in a lot of industries, with crypto being one of them - as Trump has committed to keeping the crypto market largely unregulated. Crypto, DeFi in particular, has historically been knee-capped by overreaching and hostile governmental agencies and regulation by enforcement, as evidenced by the plethora of Wells notices and lawsuits over the past few years. With Donald Trump winning the presidency, Republicans taking control of the Senate, and being on the verge of securing the House, we think it’s likely that crypto realizes positive regulatory clarity. Below, you can find our analysts’ takes:

article-image

Solana is the crowd favorite to potentially flip Ethereum somewhere down the line, and it tends to feel realistic at times

article-image

Of course, a lot has happened since the 600+ survey respondents shared their thoughts between Aug. 15 and Oct. 1

article-image

AI’s future shouldn’t be decided by a handful of tech giants

article-image

A look at software wallet Exodus may show how an SEC shakeup could have a real impact on industry companies

article-image

Co-chairing Trump’s transition team to help fill administration positions is Cantor Fitzgerald CEO Howard Lutnick

article-image

Reflect is a delta-neutral currency protocol that lets tokens accrue yield without touching the banking system