Dubai Financial Services Authority launches tokenization regulatory sandbox

Dubai Financial Services Authority (DFSA) announced that it is inviting companies to apply to join its tokenization regulatory sandbox, with the application deadline set for April 24, 2025. The DFSA is an independent regulatory authority responsible for overseeing the Dubai International Financial Centre (DIFC). In its announcement on March 17, the DFSA stated that the sandbox initiative aims to attract companies looking to offer tokenized investment products and services. The sandbox provides a controlled environment for companies to test tokenized financial solutions under the supervision of regulatory authorities.

The DFSA explicitly stated that eligible services include tokenized stocks, bonds, Islamic bonds, and units of collective investment funds. Both existing companies that are already authorized by the DFSA and looking to expand their tokenization business, as well as new applicants who meet the criteria, can submit applications. Once the application is submitted, the company will go through an evaluation process. Selected companies will receive structured testing opportunities within the sandbox and tailored regulatory guidance. The DFSA emphasized that only companies with strong business models and solid compliance capabilities will be selected. The sandbox initiative is part of the DFSA's broader innovation testing license program, aimed at helping companies enhance financial products and prepare for full authorization.