By
Chimamanda U. Martha
April 26th, 2024
More than 4,300 registered companies operating within the DIFC can now integrate XRP and TON tokens into their virtual asset services.
The Dubai Financial Services Authority (DFSA) has added XRP (XRP) and Toncoin (TON) to the list of tokens that can be legally utilized within the Dubai International Financial Centre (DIFC). Now the total list of approved coins is brought to five, with Bitcoin (BTC), Ethereum (ETH), and Litecoin (LTC) authorized back in 2022.
Recognition by the Dubai International Financial Centre is a significant milestone for tokens that can expand their use. Notably, DIFC is the leading international financial hub in the Middle East, Africa, and South Asia, with more than 4,300 registered companies located in this special economic zone. All those companies operating within the DIFC can now integrate XRP and TON tokens into their virtual asset services.
Back in 2020, Ripple chose the DIFC as the location for its MENA headquarters due to Dubai’s innovation-forward regulations, expansive network, and reputation as a leading global financial center. The region has become one of the key markets for the company, as about 20% of Ripple’s clients are located in the Middle East and North Africa (MENA) region. Amid strong growth in the Middle East, Ripple opened a new office located in the heart of the Dubai International Financial Centre. Besides, the company is bringing Swell Global 2023, the seventh edition of its annual customer conference, to Dubai on November 8th and 9th.
Ripple CEO Brad Garlinghouse commented:
“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.”
For Toncoin, winning approval from DFSA is a breakthrough achievement in its history and a great opportunity to expand its client base.
DIFC Leading In Crypto Regulation
With its comprehensive approach to crypto industry regulation, DIFC zone pioneers in the digital assets space, offering a robust regulatory framework for crypto and investment tokens.
In 2021, the Dubai Financial Services Authority (DFSA) – an institution that regulates the DIFC zone – introduced the Investment Token Regime for governing digital assets. That was the initial phase of the whole legislation at that time. The key highlights included defining tokens, categorizing them, and introducing custody rules for digital wallets.
In November 2022, DFSA launched the second phase of the Investment Token Regime, providing more clarification and removing potential ambiguities. Firstly, the DFSA expanded its initial list of ‘recognized’ crypto tokens for the DIFC. The list applies to all entities in the DIFC. Once a crypto token is ‘recognized’ by the DFSA, an application for recognition does not need to be made by another entity. Now, XRP and TON are among the recognized tokens.
Secondly, while non-fungible tokens (NFTs) and utility tokens are not covered by DFSA regulation, they have been brought within the remit of the DFSA’s anti-money laundering and counter-terrorist financing regime. Issuers of such tokens (unless their issuance does not exceed a $15,000 de minimis threshold), as well as service providers (such as auction houses, issuance platforms, and safekeeping services), have to be registered with the DFSA as designated non-financial businesses or profession and comply with the associated AML requirements.
The next step will be the introduction of public consultations on other areas including staking, DeFI, and AML / CTF issues such as the travel rule.