The Dubai Financial Services Authority (DFSA) has established a regulatory framework for investment tokens as part of its efforts to stimulate the digital financial and technological environment while too meeting market players' demands and requirements.

The DFSA is an contained regulatory body in Dubai that is in charge of monitoring and regulating financial services companies wanting to operate in the city. Information technology also licenses and regulates its products and services.

Co-ordinate to a study by Emirati news agency WAM, the DFSA'southward regulatory framework defines investment tokens as either "a Security Token or Derivative Token."

The report notes that the creation of a new regulatory structure is the outset step in the DFSA's Digital Assets Regime, which reflects the suggestions made in Consultation Paper 138 published in March 2022. The consultation paper sought public input on the DFSA'southward plans for regulating security Tokens.

As reported by Cointelegraph in March, the financial regulator in Dubai called on members of the public to submit comments on its proposed rules for cryptocurrencies considered to exist security tokens.

The investment token framework is designed to safeguard investors and provide legal certainty for market operators.

Related: UAE regulators approve crypto trading in Dubai free zone

It specifies the sort of investment tokens that are permitted and which may be listed on a Digital Asset Substitution in the Dubai International Financial Centre, likewise as other pertinent information.

The DFSA is also working on plans for unlisted securities non covered by the investment tokens regulatory framework. These are predictable to include cryptocurrencies, utility tokens and sure stablecoins. The DFSA is expected to publish a follow-up consultation newspaper in the quaternary quarter of this year.