DFSA Tokenisation Sandbox Attracts ~100 Firms, Boosting DIFC Fintech

The Dubai Financial Services Authority (DFSA), the independent regulator of the Dubai International Financial Centre (DIFC), has revealed that 96 firms have shown interest in its first-ever Tokenisation Regulatory Sandbox. This new initiative marks a significant milestone in the DFSA’s ongoing mission to encourage responsible innovation in finance, with tokenisation emerging as a powerful trend shaping the future of the financial industry.

Integrating Innovation with Regulatory Oversight

This sandbox is a key component of the DFSA’s Innovation Testing Licence programme. It is designed to nurture financial innovation while ensuring robust regulatory standards remain in place. The diverse expressions of interest came from various sectors exploring tokenisation applications for assets like shares, sukuk (Islamic bonds), investment fund units, and custody and trading solutions, highlighting the technology’s wide-ranging applicability within modern financial markets.

Broad Industry Participation from Startups to Institutions

The initiative has drawn strong participation from both established financial players and emerging tech startups. Traditional institutions are eager to explore how tokenisation can streamline operations and enhance services, while fintech innovators see the sandbox as a launchpad for scalable digital asset solutions. This level of engagement reinforces the DIFC’s rising status as a global centre for digital finance and emerging financial technologies.

Justin Baldacchino, Managing Director, Supervision, DFSA, said: “We are excited to see such strong interest in the DFSA’s Tokenisation Regulatory Sandbox and to talk about it at the Dubai FinTech Summit. This momentum supports the DFSA’s strategic commitment – and aligns with the Dubai Economic Agenda D33 goal – to position Dubai among the world’s top four global financial hubs by 2033. The sandbox marks a new chapter in our engagement with innovative financial technologies, enabling firms to safely test tokenised solutions in a transparent, measured, and responsible manner, within a well-regulated environment, without being subject to the full suite of regulatory requirements that would otherwise apply.”

A Thematic and Targeted Regulatory Approach

The DFSA is leveraging a thematic sandbox model, allowing for focused regulatory interaction, tailored oversight, and the crafting of informed policy responses to fast-evolving technologies. This approach supports broader ambitions across Dubai and the UAE to be global leaders in digital assets, fintech, and future-ready financial infrastructure.

Pathway to Live Testing and Licensing

Following this initial interest phase, selected participants will be invited to formally apply for an Innovation Testing Licence. Approved firms will enter a controlled testing environment, where they can refine their business models while addressing key areas such as investor protection, transparency, and financial system stability. Those that meet regulatory standards during testing may later transition to full licensing or exit the programme.

Advancing Innovation with Global Standards in Mind

The DFSA’s Tokenisation Regulatory Sandbox reflects the regulator’s commitment to advancing innovation in a manner that is both forward-thinking and globally aligned. By combining a supportive testing environment with rigorous oversight, the DFSA is helping to shape a safe and vibrant digital financial ecosystem within the DIFC and beyond.