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BTC, ETH, and Now XRP: Dubai’s Exclusive List of Permitted Assets
- Dubai’s DFSA approves Ripple’s XRP for use in the DIFC, advancing the company’s expansion in the MENA region.
- The DFSA enforces strict token taxonomy in Dubai, allowing only a small set of approved crypto tokens for financial activities.
- Ripple’s CEO, Brad Garlinghouse, praised Dubai’s supportive stance on innovation and clear crypto regulations.
Dubai Allows XRP Registration
Ripple has received approval for its XRP token from the Dubai Financial Services Authority (DFSA), allowing firms within the Dubai International Financial Centre (DIFC) to use XRP, given they are appropriately licensed.
This inclusion into the DFSA’s virtual assets regime adds XRP to a list of previously approved cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and Litecoin (LTC). Also approved at the same time was Toncoin (TON), making these five the only digital assets with approval in Dubai.
Ripple has identified the DIFC as its headquarters for the Middle East and North Africa (MENA) regions, noting that a significant portion of its customer base, approximately 20%, is located in the MENA region. This approval marks a step forward in Ripple’s expansion goals within Dubai.
Prohibited Tokens
The token taxonomy in Dubai is considered strict, containing several provisions regarding prohibited or excluded tokens. The DFSA for example does not allow privacy tokens such as Monero (XMR) or tokens linked to algorithmic stablecoins such as Terra (LUNA).
The framework dictates that financial services and other specific activities can only be legally conducted with crypto tokens that have been recognised by the DFSA. This regulation includes restrictions on derivatives related to crypto tokens and investments made by funds or portfolio managers in such tokens.
DFSA Regional Partnerships
The DFSA has several partnerships with other regional players such as monetary authorities and securities commissions in Singapore, Japan, Hong Kong and Australia.
In 2017 the DFSA and the Australian corporate watchdog ASIC entered into an agreement to mutually support fintech innovation. The agreement facilitates the entry of fintech businesses into each other’s markets, encourages information sharing, particularly on regulatory technology, and continues the collaboration between the two regulators.
This agreement adds to ASIC’s existing fintech partnerships with several other international regulatory bodies.
Reactions to XRP Announcement
Ripple CEO Brad Garlinghouse stated that Dubai’s regulatory authorities have shown a strong support for innovation, and their recent announcement reinforces this stance. Ripple, recognising the clear regulatory framework for cryptocurrencies in Dubai, is committed to expanding its operations in such supportive regions.
He said, this commitment is highlighted by Ripple’s choice to host the RippleSwell event in Dubai this year. In comments possibly intended as a pun towards the United States, Garlinghouse added, “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.”
Author
Aaron Feuerstein
Aaron Feuerstein is a freelance writer based in Melbourne. His focus is on decentralised finance and the regulatory space surrounding blockchain. He holds a Master's in Accounting. When he is not studying the latest legal case, he enjoys his time as a modest but eager hobby cook.
