DFSA’s Charlotte Robins on how its Tokenisation Sandbox is gaining traction
The MD of Policy and Legal at the Dubai Financial Services Authority shares how nearly 100 expressions of interest from six jurisdictions in the Tokenisation Regulatory Sandbox reflect growing global demand for responsible financial innovation
18 July, 2025
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Charlotte Robins, MD of Policy and Legal at the Dubai Financial Services Authority (DFSA), shares how nearly 100 expressions of interest from six jurisdictions in the Tokenisation Regulatory Sandbox reflect growing global demand for responsible financial innovation.
In this interview, Robins discusses the models that stood out, how the initiative aligns with Dubai’s D33 economic agenda, and how the DFSA is balancing innovation with robust regulation to position the DIFC as a top-four global financial hub.
The Tokenisation Regulatory Sandbox attracted 96 expressions of interest from six jurisdictions. What does this level of global interest tell you about the future of tokenisation and DFSA’s regulatory positioning?
The global interest in our Tokenisation Regulatory Sandbox signals the importance of, and growing appetite for, responsible innovation, and recognises the appeal of DFSA’s regulatory approach to innovation. As a regulator, our role is to support innovation and its positive contribution to the financial markets in ways that maintain market integrity and protect the public interest within the DIFC. By working closely with local and global firms through the sandbox, we are encouraging responsible innovation and helping to ensure that new ideas are tested against regulatory expectations.
What were some of the most promising or innovative tokenisation models proposed by applicants? Were there any particular sectors — like sukuk or property funds — that stood out?
The expression of interest process provided the DFSA with valuable insight into the diversity and maturity of tokenisation models being developed globally. The DFSA received nearly 100 responses – includingproposals to tokenise financial assets and instruments, such as bonds (including Islamic bonds, or sukuk), units in a fund (including money market funds and property funds), and the trading and safe custody of those assets – reflecting the broad potential of tokenisation across the financial ecosystem.
The initiative attracted strong interest from both established financial institutions wishing to explore tokenisation use cases and innovative start-ups looking to scale breakthrough digital asset solutions in a regulated environment. Applications were received from within the UAE and from other regions such as the UK, EU, Canada, Singapore and Hong Kong.
Can you walk us through the evaluation process? What key factors determined whether a firm was invited into the Innovation Testing Licence programme versus granted full authorisation?
As a brief recap, the expression of interest (EOI) period ran from March– April this year. Thereafter we conducted an initial assessment of the submissions received and whether the tokenisation activities fall within our regulatory perimeter of financial services activities that can be conducted in the DIFC.
Following these assessments, the DFSA had discussions with a majority of the applicants and shortlisted those that were sufficiently clear on their business model, ready to do business in and from the DIFC and had a level of familiarity with DFSA rules, and therefore ready to progress to the next stage.
In June, a number of firms were then invited to prepare their applications, either for the Innovation Testing Licenceprogramme (ITL), which is our regulatory sandbox, or where the business model is sufficiently matured and tested in other markets, for a full licence.
The DFSA assesses the firms’ readiness to apply for the Tokenisation Sandbox based on the ITL eligibility criteria that we have in place, such as:
How does the DFSA strike a balance between enabling financial innovation and ensuring market integrity, particularly with emerging technologies like tokenisation?
At the DFSA, we recognise that robust, balanced, and proportionate regulatory frameworks have a key role to play in creating an environment in which innovative firms can thrive. On this basis, we create, and tailor our regulatory regimes appropriately and don’t seek to impose unnecessary regulatory burden, and inadvertently stifle innovation. To that end, we always publicly consult on any changes to our rulebook to ensure that our approach to regulation:
- Is proportionate and risk-based enough to foster beneficial innovation, yet robust enough to avoid a race to the bottom and a loss in trust and confidence;
- Evolves and adapts in line with market developments, adopting the principle of “same activity, same risk, same regulatory outcome”; and
- Focuses on regulatory outcomes that meet the needs of local markets rather than adopting a ‘one-size-fits-all’ regulatory approach.
Additionally, on an ongoing basis we proactively engage with market participants, their advisors, and industry bodies, for example, to ascertain how our regulatory regime can be enhanced and improved e.g., via industry webinars, roundtables, outreaches, and consultation. In such an area where rapid change appears to be a permanent feature of the environment within which these markets operate, we see both collaboration and industry engagement as being essential.
From investment tokens to stablecoin approvals, the DFSA has taken progressive steps in digital asset regulation. How will insights from this sandbox phase inform future regulatory developments?
Insights from our sandbox – the Innovation Testing License, will allow us to observe how innovative technologies perform in a controlled environment. This will enable us to identify potential risks, benefits and gaps in existing regulation, which will in turn lead to more informed balanced, and adaptive policymaking that supports innovation while protecting consumers. We are continuously developing our models and policies to ensure that they don’t stifle growth whilst ensuring investor protection and responsible innovation.
In May 2025, we published an explainer guide to clarify the process of applying to the ITL sandbox so that we can continue to empower innovators with the knowledge they need to engage with the DFSA and bring transformative financial services to market in the DIFC.
We’re seeing more interest in innovation / crypto – firms coming to us and we collaborate with other regulatory standard-setter via groups such as the Global Financial Innovation Network (GFIN) to ensure that we share-knowledge and best practices. As a regulator, it’s important that we are balance growth and innovation whilst continuing to protect our stakeholders, investors and the market.
In terms of what we are seeing in the innovation space – Tokenisation is probably at the top of the list.
How does the Tokenisation Regulatory Sandbox align with Dubai’s D33 economic agenda? In your view, what role will tokenisation play in helping DIFC become one of the world’s top four financial hubs?
The DFSA’s regulatory ITL Sandbox aligns with Dubai’s D33 economic agenda by enabling safe experimentation with tokenised and innovative financial products – positioning the DIFC at the forefront of FinTech innovation. As Dubai aims to become one of the world’s leading financial hubs, our sandbox serves as a practical mechanism for translating policy into real-world outcomes. Attracting global players while shaping regulation which is ready for the future. By embedding tokenisation within a transparent framework, we are not only fostering innovation, but setting global standards, cementing Dubai as a leading jurisdiction for digital finance.
DFSA has been opening its regulatory sandbox to non-traditional financial institutions and tech startups. What strategies are you deploying to ensure diverse participation—and how is that shaping your regulatory toolkit?
To ensure diverse participation of non-traditional financial institutions (NBFIs) and tech start-ups in the ITL programme, DFSA implements a combination of outreach, design flexibility, incentivisation and support mechanisms. Some of the key strategies implemented by the DFSA include:
Initiatives such as the DFSA’s Tokenisation Regulatory Sandbox underscores the DFSA’s commitment to enable innovation in a way that is responsible, informed, and aligned with global regulatory best practice – supporting the DIFC’s position as a leading hub for digital finance, and aligning with Dubai’s Economic Agenda D33, which aims to make Dubai one of the world’s top four global financial hubs by 2033.
As previously mentioned, our sandbox, will allow us to observe how innovative technologies perform in a controlled environment which will in turn enable us to identify potential risks, benefits and gaps in existing regulation – resulting to more informed balanced, and adaptive rulemaking.
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