Article / 11 Feb 2026
The Dubai Financial Services Authority’s (DFSA) latest amendments to the Crypto Token Regulatory Framework came into force in January 2026.
The changes significantly reshape how Crypto Token activities are regulated in the Dubai International Financial Centre (DIFC), shifting responsibility away from regulator-led approvals and placing greater emphasis on firm-level judgement, governance and accountability.
Under the updated framework, responsibility for Crypto Token suitability now sits directly with firms. Firms must determine, on a reasoned and well-documented basis, whether each Crypto Token they engage with meets the suitability criteria set out in GEN Rule 3A.2.1, taking into account the nature of the activity, the business model and the associated risks.
At the same time, the DFSA has removed the list of Recognised Crypto Tokens. Firms may now only engage with Crypto Tokens they have independently assessed as suitable in accordance with DFSA requirements and must be prepared to justify those decisions during supervisory engagement.
The amendments also introduce greater flexibility for funds investing in Crypto Tokens. Previous thresholds and restrictions on direct or indirect investments have been removed, provided that appropriate suitability assessments, risk management frameworks and disclosures are in place.
Alongside this increased flexibility, the DFSA has raised expectations around investor safeguards. Updated conduct, governance, custody and disclosure requirements are intended to strengthen protections for users of Crypto Token services and improve transparency across the market. Reporting and supervisory requirements have also been refined to better reflect evolving risks and market developments.
These changes mark a clear move away from a prescriptive, regulator-approved token model toward context-specific, defensible decision-making by firms. The key regulatory question is no longer “Is this token recognised?” It is now “Can you demonstrate why this token is suitable for your business and how you are managing the risks?”
Firms must be able to evidence their assessments, embed Crypto Token risk into governance and compliance frameworks and stand behind their decisions if challenged.
If you are a DIFC firm, ask yourself:
Firms have a three month transition period, expected to run until 12 April 2026, to review any Crypto Tokens previously recognised under the former framework and to update their internal policies, systems, controls and disclosures to ensure compliance with the new requirements.
For firms, the updated framework provides greater flexibility to engage in Crypto Token activities within a clearer and more mature regulatory structure, alongside clearer accountability for risk assessment and management.
For investors and users, the changes deliver stronger protections through enhanced governance and custody requirements, greater transparency around Crypto Token services offered in the DIFC and increased confidence in a well-regulated digital assets environment.
For the DIFC ecosystem more broadly, the amendments reinforce the DFSA’s commitment to responsible innovation, alignment with global regulatory standards and a framework capable of evolving alongside market and technological developments.
The January 2026 updates represent a significant evolution in the DIFC’s approach to Crypto Token regulation. By shifting responsibility to firms while strengthening governance and investor protections, the DFSA has established a framework that balances flexibility with accountability.
Firms operating in this space should view the changes not simply as a compliance exercise, but as an opportunity to embed more rigorous decision-making, risk management and transparency into their Crypto Token activities. Those that can clearly articulate and evidence their approach will be best placed to operate confidently within the DIFC’s evolving digital assets landscape.
If you would like support in understanding how these changes may affect your business or assistance in meeting the updated DFSA requirements during the transitional period, please reach out to our corporate team at Gateley Middle East.
Whether you are already established in the DIFC or looking to set up, our team can guide you through the necessary legal, regulatory and compliance considerations to ensure your business remains aligned with the new framework.
For more information contact our expert below or meet our team in the Middle East here.