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Dubai’s financial regulator has taken steps to ban private equity funds from the Dubai International Financial Center, citing growing risks related to money laundering and sanctions.
Important points:
- Dubai has banned private tokens and anonymous instruments in the DIFC in line with international anti-money laundering and sanctions laws.
- The regulatory body has strengthened the definition of stablecoins, excluding algorithmic examples from “fiat-denominated crypto-tokens.”
- Cryptocurrency companies, not regulators, are now responsible for approving and monitoring the tokens they write.
The decision is part of a comprehensive overhaul of the emirate’s cryptocurrency policy, which also narrows the definition of stablecoins and transfers the main responsibility for accepting tokens to authorized companies.
Dubai shifts cryptocurrency management from accepting tokens to holding companies accountable
It shows the updated system of cryptocurrency tokens, which It will come into effect on January 12 Changes to the Dubai Financial Services Authority strategy.
Instead of maintaining a centralized list of approved crypto products, the regulator will focus on enforcing international standards and holding companies accountable for the tokens they choose to issue.
Under the new rules, the use of private symbols is prohibited for all sales, promotions, fund and derivative transactions that take place within or from the DIFC.
The ban comes at a time when other privacy-focused products have seen renewed interest in the market, but the Dubai Financial Services Authority said compliance concerns leave no room for change.
In addition to banning privacy-focused cryptocurrencies, the framework also prohibits regulated companies from using or providing tools designed to encrypt data, including hashes, tumblers, and other data encryption services.
The move brings Dubai closer to the EU’s position under the MiCA, which has effectively taken the anonymity of cryptocurrency from regulated markets, as it differs from jurisdictions like Hong Kong that still allow private tokens under legal conditions.
BREAKING: Dubai’s financial regulator has banned private tokens from the Dubai International Financial Center, citing AML and penalty threats. The amended rules also ban mixers like Tornado Cash. pic.twitter.com/VOUJ5w4bmn
— SolanaFloor (@SolanaFloor) January 12, 2026
Stablecoins are another major target of the amended regulations.
The Dubai Financial Services Authority has narrowed its definition of what it calls “fiat-linked crypto asset tokens,” limiting the category to fiat-linked assets that are backed by highly liquid reserves that can meet redemptions in times of crisis.
Algorithmic stablecoins, which rely on trading methods rather than direct support, fall outside this definition.
Although algorithmic tokens may not be strictly banned, they will be treated as regular crypto assets instead of stablecoins within the DIFC.
Perhaps the most important change is the change in style. Instead of approving individual tokens, the DFSA will require licensed companies to continuously review, document and review the suitability of their listed crypto assets.
The regulator said the change was made based on industry feedback and recognizing the growing number of companies operating in the DIFC.
The UAE continues to attract cryptocurrency companies
The move comes as the UAE continues to consolidate its position as a hub for blockchain technology and cryptocurrency, with improved regulatory transparency attracting major global players.
A government-backed financial firm in Abu Dhabi is said to have invested $2 billion in cryptocurrency trading platform Binance using USD1, a stablecoin developed by World Liberty Financial – a cryptocurrency service closely associated with the Trump family.
Experts say that the UAE is poised to become a major hub for cryptocurrencies and stablecoins seeking protection from the European Union’s newly enacted Markets in Cryptoassets (MiCA) regulations.
The legal framework, which began to work in full on December 30, brings serious problems to cryptocurrency companies within the 27-member bloc, encouraging many to consider moving their headquarters, according to industry experts.
Among its strict requirements, small stablecoin providers must hold 30% of their reserves in EU commercial banks with low risk, while major players such as Tether face the obligation to hold 60% or more in similar institutions.
A note The Dubai Financial Services Authority (DFSA) bans private tokens in the DIFC and introduces stricter regulations on cryptocurrencies appeared for the first time Cryptonews Arabic.
