In March 2022, the DFSA published Consultation Paper (CP) 143 on the regulation of Crypto Tokens, with the intention of putting into place a comprehensive regime that addressed a wide range of risks associated with Crypto Token business. This included requirements relating to technology, governance, custody, disclosure, market abuse and fraud.
Since then, many regulatory developments have been seen, including recommendations being published by international standard setters. and more recently, the Basel Committee proposed amendments to its standard on the prudential treatment of banks’ exposures to crypto assets, specifically, a set of changes relating to the composition of the reserve assets of stablecoins in Group 1b. 10.
DFSA has reviewed the approach it has adopted, as well as looking at what other regulators with similar approaches have done, to see if any adjustments should be made. Accordingly, the Authority submits proposals regarding the following:
Crypto Token Recognition, Collective Investment Funds, Private keys and digital wallets, Segregation, Unauthorised or incorrectly executed transfers, Third Party Agents, Records and so many.