The Dubai Financial Services Authority (DFSA) has received expressions of interest from 96 firms for its first Tokenisation Regulatory Sandbox as part of efforts to test digital asset solutions within the Dubai International Financial Centre (DIFC).
The sandbox, launched under the DFSA’s Innovation Testing Licence programme, is aimed at allowing companies to pilot tokenised financial instruments in a controlled regulatory environment. Participants include financial institutions and startups exploring use cases such as tokenised shares, bonds, sukuk, fund units, and the associated trading and custody infrastructure.
The DFSA said the sandbox is part of its broader strategy to support innovation while safeguarding investor protection and market integrity. Applications span multiple asset classes and financial services, indicating growing market interest in tokenisation as a financing and trading mechanism.
The announcement comes ahead of the Dubai FinTech Summit and aligns with the Dubai Economic Agenda D33, which targets making Dubai one of the top four global financial hubs by 2033.
Companies selected from the initial pool of applicants will be invited to apply for a DFSA Innovation Testing Licence and move to a live testing phase. During this stage, firms can trial their products under regulatory supervision without the full burden of licensing requirements. After the testing, firms may apply for a full operating licence or exit the programme.
DFSA Managing Director of Supervision Justin Baldacchino said the regulator’s sandbox is designed to promote regulatory engagement and risk-managed innovation while also supporting the UAE’s broader digital asset ambitions. The initiative complements other digital finance efforts within DIFC, including frameworks for crypto tokens and distributed ledger technologies.
The DFSA is one of the first regulators in the region to introduce a comprehensive regulatory framework for digital assets, and its sandbox will serve as a model for iterative policymaking in a sector where technology continues to evolve rapidly.
