DFSA and DIFC Digital Assets and FinTech Authorisation

by Barrister Tahmidur Rahman | Sep 28, 2026

Trade, Competition & RegulationDIFC authorisation, Bangladesh perspective8 min read

DFSA and DIFC Digital Assets and FinTech Authorisation

Legal advice for Bangladeshi entrepreneurs, financial institutions, fintech groups and investors seeking DFSA authorisation in the Dubai International Financial Centre for digital assets, tokenisation, payments and other fintech activities, including Bangladesh foreign exchange, tax and regulatory coordination for founders, staff and investors.

Overview

DIFC regulation of digital assets and fintech for Bangladesh-linked businesses

The Dubai International Financial Centre is a financial free zone with its own common law legal system, courts and regulator, the Dubai Financial Services Authority (DFSA). It has become a significant hub for regulated digital assets businesses, tokenisation projects, payment firms and wealth platforms. Founders and financial groups from Bangladesh, along with diaspora entrepreneurs in the Gulf, increasingly consider it when they want a credible international base. We advise these clients on the DFSA route as part of our regulatory practice in Bangladesh, working with DIFC-qualified counsel where local representation or formal filings are needed.

The DFSA regulates financial services in or from the DIFC under a framework of laws and rulebook modules. Its regime for digital assets distinguishes investment tokens, which are treated like securities or derivatives, and crypto tokens, which are subject to specific rules on which tokens may be used, how they are held and what disclosures clients receive. Algorithmic stablecoins and privacy tokens have been excluded, and the DFSA's approach to approving tokens has been refined. Firms must hold a licence covering each financial service they provide, such as dealing, arranging, advising, custody or operating a trading facility.

The DFSA also supports innovation through testing routes. An Innovation Testing Licence allows eligible firms to test new financial products under restricted conditions before seeking full authorisation, and the DIFC has run programmes aimed at fintech and tokenisation. These routes are useful but not shortcuts: applicants still need credible governance, capital, systems and anti-money laundering controls. Payment services, money services and crowdfunding have their own requirements within the DIFC. Because the DFSA updates its rules and policy statements, we review the current regime for each proposed business rather than relying on older guidance or marketing summaries of the free zone.

For clients with Bangladesh links, regulatory questions do not end at the DIFC boundary. Bangladesh Bank has warned that virtual currency dealings are not authorised in Bangladesh, and outward investment from Bangladesh generally requires approval. A DIFC firm dealing in digital assets that is founded or funded from Bangladesh must address how capital lawfully leaves the country, the tax position of Bangladeshi shareholders, the role of any Bangladesh technology team, and whether the business can lawfully serve Bangladeshi customers. Our technology lawyers in Bangladesh coordinate these points with the DIFC application, so that both legal positions remain consistent.

Authorisation is followed by supervision. DFSA firms must maintain capital and liquidity, systems and controls, client money and asset protections, anti-money laundering procedures, regulatory reporting and approved individuals, and must seek approval for many changes. Barrister Tahmidur Rahman advises on transactions, finance and investment, Barrister Remura Meheruba Mahbub, a non-practising solicitor of England and Wales, on corporate, banking and foreign investment matters, and Adv Syed Wahid on disputes. We work with counsel in the UAE, UK, US, India, China and Singapore. To discuss a DIFC digital assets or fintech project, please contact our Dhaka office.

01 · What we handle

Core workstreams

  • Regulatory perimeter analysis
  • Structuring for Bangladesh-linked groups
  • Application and governance documents
  • Tokenisation and product design
02 · How it runs

Four clear stages

  1. 01Assess the proposition
  2. 02Design the structure
  3. 03Prepare and submit
  4. 04Launch and supervise
03 · Start here

Talk to a partner

Consultations in Dhaka or by video. Scope, team and fees are agreed in writing first.

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How we help

How we support DIFC applicants

Workstream 01Trade, Competition & Regulation

Regulatory perimeter analysis

  • Assess the proposition
  • Design the structure
  • Prepare and submit
  • Launch and supervise
Workstream 02Trade, Competition & Regulation

Structuring for Bangladesh-linked groups

  • Assess the proposition
  • Design the structure
  • Prepare and submit
  • Launch and supervise
Workstream 03Trade, Competition & Regulation

Application and governance documents

  • Assess the proposition
  • Design the structure
  • Prepare and submit
  • Launch and supervise
Workstream 04Trade, Competition & Regulation

Tokenisation and product design

  • Assess the proposition
  • Design the structure
  • Prepare and submit
  • Launch and supervise
Workstream 05Trade, Competition & Regulation

Investment and transactions

  • Assess the proposition
  • Design the structure
  • Prepare and submit
  • Launch and supervise
Workstream 06Trade, Competition & Regulation

Supervision, enforcement and disputes

  • Assess the proposition
  • Design the structure
  • Prepare and submit
  • Launch and supervise
01

Regulatory perimeter analysis

We analyse the proposed product and map it against DFSA financial services, the investment token and crypto token regimes, payments and money services rules, and other UAE frameworks such as VARA, the ADGM and the UAE Central Bank. We identify which licences are required, whether a testing route is suitable, and which activities should be restructured or dropped to keep the authorisation proportionate and achievable within a sensible budget, while leaving room for the digital assets products the business may add later.

02

Structuring for Bangladesh-linked groups

We design holding, operating and service structures for groups with Bangladeshi founders, shareholders or staff, covering the DIFC entity, any parent company and any Bangladesh subsidiary. We address Bangladesh Bank approvals for outward investment, remittances of fees and salaries, tax residence and transfer pricing, and how to keep Bangladesh operations clearly within lawful technology or support services rather than regulated financial activity. Written service agreements, clear job descriptions and board minutes help demonstrate that line to regulators in both countries.

03

Application and governance documents

Working with DIFC counsel, we help prepare regulatory business plans, financial projections, governance frameworks, compliance manuals, risk management and anti-money laundering policies, client agreements and disclosures for digital assets products. We review consistency across documents and anticipate DFSA questions on ownership, controllers, approved individuals, outsourcing and systems, so that the application can move through review without avoidable delays or repeated clarifications. We also prepare founders and senior managers for regulatory interviews about their roles and experience.

04

Tokenisation and product design

We advise on the legal characterisation of tokenised securities, funds, sukuk, real estate and other assets, the rights attached to tokens, custody and settlement arrangements, and investor disclosures. For Bangladesh-linked assets, we analyse whether underlying property, receivables or securities in Bangladesh can lawfully be tokenised and offered abroad, which often raises foreign exchange, securities and land law questions under Bangladesh law. We set out those issues early, before any digital assets linked to Bangladesh are offered.

05

Investment and transactions

We act for investors and founders on equity and convertible investments, shareholder agreements, acquisitions and joint ventures involving DFSA-authorised firms, including change of control approvals. We advise on how investment funds may flow from Bangladesh, the UAE or third countries, the documents banks and regulators will ask for, and warranties and conditions that protect investors in regulated digital assets businesses, including protections linked to licence conditions, key person risk and future regulatory change.

06

Supervision, enforcement and disputes

We support authorised firms with compliance reviews, regulatory change, notifications and responses to DFSA supervisory queries, investigations and enforcement. We also act in disputes involving founders, investors, clients and service providers, including proceedings in the DIFC Courts, arbitration, and enforcement in Bangladesh of judgments and awards, which requires careful planning when assets or parties are located there. Early advice on evidence, interim relief and the enforcement route usually saves considerable time and cost.

RecognitionThe Legal 500Asia Pacific ranks Tahmidur Remura Wahid (TRW) Law Firm for dispute resolution in Bangladesh.
Cross-border reach6 jurisdictionsMatters coordinated with counsel in the UK, US, UAE, China, India and Singapore.
Bar and admissionsDhaka and LondonBarristers and advocates in Bangladesh, with a solicitor of England and Wales (non-practising).
HeadquartersDhakaHouse 410, Road 29, Mohakhali DOHS. Consultations in person or by video.
Who leads this work

Partner-led, on every matter.

Trade, Competition & Regulation matters at TRW are led by partners, supported by associates, with one responsible lawyer from first advice to final outcome.

Meet the firm →
01

Does the DFSA regulate digital assets differently from VARA?

Yes. VARA regulates virtual asset activities in Dubai outside the DIFC, while the DFSA regulates financial services in or from the DIFC, including those involving digital assets. The DFSA regime distinguishes investment tokens, treated like traditional securities or derivatives, from crypto tokens, which are subject to specific rules on permitted tokens, custody and disclosure. The licensing structure, capital rules, supervisory approach and legal system differ, with the DIFC applying its own common law framework. A business should choose its base after comparing the regimes against its products, target clients, investors and banking needs, rather than on cost alone.

02

What is an Innovation Testing Licence for digital assets and fintech firms?

An Innovation Testing Licence is a DFSA authorisation that allows eligible firms to test innovative financial products or services within the DIFC under restrictions, such as limits on client numbers or exposure, for a defined period. It is designed for genuinely new propositions rather than as a cheaper permanent licence. Applicants must still show suitable governance, controls and resources, and must plan how they will move to full authorisation or exit when testing ends. We advise on whether a digital assets proposition is likely to be eligible and on preparing a credible testing plan that the DFSA can assess.

03

Can a Bangladeshi bank or NBFI set up a DIFC entity for digital assets?

A Bangladeshi bank or non-bank financial institution would need to consider Bangladesh Bank approval for any overseas investment or establishment, its own licence conditions and Bangladesh's position on virtual currencies, which is restrictive. Activities involving tokenised traditional assets may be treated differently from crypto token activities, but each requires analysis under Bangladesh law before any step is taken. On the DIFC side, the DFSA will review the parent's regulatory status and home-state supervision. We advise financial institutions on both regulatory sides and on the approvals sequence, so that the project does not breach Bangladeshi rules.

04

Which crypto tokens can a DFSA firm deal in?

The DFSA restricts the crypto tokens that authorised firms may use in their services, applying criteria such as regulatory status in other jurisdictions, transparency, liquidity, market size and the technology involved. Privacy tokens and algorithmic stablecoins have been excluded. The DFSA's approach to deciding which tokens may be used has evolved, and firms may have their own assessment responsibilities as well as relying on any regulator list. Because this area changes, we check the current DFSA rules and policy before a firm commits to supporting a particular token or launching digital assets products around it.

05

How long does DFSA authorisation take?

Timing depends on the complexity of the business, the licence categories sought, the applicant's ownership and controllers, the completeness of the application and how quickly questions are answered. DIFC company registration, regulatory review, approval of individuals and pre-launch conditions all form part of the overall timeline. Firms entering through a testing route may move faster initially but must plan for transition. We help clients assemble complete applications for digital assets and fintech businesses and respond efficiently, and give realistic planning guidance, but we do not guarantee timelines that depend on the regulator's review and its supervisory priorities at the time.

06

Can a DIFC digital assets firm serve customers in Bangladesh?

Authorisation in the DIFC does not permit activity in Bangladesh. Bangladesh Bank has warned that virtual currency transactions are not authorised and may breach foreign exchange and anti-money laundering laws, and cross-border investment by Bangladesh residents is controlled. Offering services to Bangladeshi residents can therefore create legal risk for the firm, its founders and its customers, even if the service is lawful under DFSA rules. Tokenised traditional assets raise their own securities and foreign exchange questions in Bangladesh. We advise on onboarding restrictions, marketing controls and the Bangladesh analysis for each product.

07

What capital and resources must a DFSA firm hold?

Capital requirements depend on the firm's prudential category, which reflects its activities, such as whether it holds client assets, deals as principal or only arranges or advises. Firms also need adequate liquidity, professional indemnity insurance in some cases, and sufficient staff and systems, including approved individuals for key functions such as senior executive, finance, compliance and money laundering reporting. Firms dealing in digital assets face additional expectations on technology governance and custody. We help clients understand the requirements for their category and present resources credibly in the application.

08

How are disputes with a DIFC firm resolved?

Client agreements with DIFC firms often choose DIFC law and the DIFC Courts, or arbitration. The DIFC Courts apply a common law approach, and their judgments can be enforced onshore in Dubai and potentially abroad, depending on the destination's rules. Where a Bangladeshi counterparty or assets in Bangladesh are involved, enforcement needs separate analysis, because foreign judgments and arbitral awards follow different routes, and Bangladesh is a party to the New York Convention for awards. We advise on dispute clauses at the outset and on enforcement strategy when a dispute arises, including against digital assets held on exchanges.

How a matter runs

From first call to resolution.

  1. 01

    Assess the proposition

    We map the product against DFSA rules and other UAE regimes, identify the licences or testing route needed, and set out the Bangladesh foreign exchange, tax and regulatory issues the structure must address before any financial commitment is made.

  2. 02

    Design the structure

    We agree the group structure, capital plan and lawful funding route, define the roles of founders, staff and service companies, and prepare a realistic timetable for DIFC registration, the DFSA application, approvals of individuals and Bangladesh approvals.

  3. 03

    Prepare and submit

    With DIFC counsel, we prepare the application, business plan, policies and governance documents for the digital assets business, submit the file, and manage DFSA questions, approvals of individuals and pre-launch conditions until authorisation.

  4. 04

    Launch and supervise

    After authorisation, we support compliance reviews, regulatory change, product approvals, transactions, supervisory queries and disputes, keeping the DIFC and Bangladesh positions aligned as the business, its investors and the rules develop over time.

“Demonstrates an extraordinary command over both domestic litigation and international arbitration.”

The Legal 500 Asia Pacific, Bangladesh: Dispute resolution, client feedback

FAQ

Questions, answered.

Still unsure? Email info@trw.co with a short outline of the matter.

What is the DFSA?
The Dubai Financial Services Authority is the independent regulator of financial services conducted in or from the Dubai International Financial Centre. It authorises firms, approves individuals, writes rulebooks, supervises compliance and takes enforcement action. It does not regulate activities in onshore Dubai, where VARA, the UAE Central Bank and the Securities and Commodities Authority have roles. Choosing the right regulator depends on where and how the business will operate, which digital assets it will handle and who its clients are.
Are digital assets regulated in the DIFC the same way as securities?
Partly. Investment tokens, which confer rights similar to shares, bonds or derivatives, are generally regulated like those traditional instruments. Crypto tokens are covered by a dedicated regime with specific requirements on permitted tokens, custody, disclosure and risk warnings. Some tokens, such as certain utility or non-fungible tokens, may fall outside or be treated differently. Correct classification of digital assets is the first step in any DIFC application, because it decides the licence, capital, disclosure and custody requirements that follow, and mistakes are expensive to correct later.
Does a DIFC entity need a physical office?
DIFC companies generally need registered premises in the DIFC, and DFSA authorised firms are expected to have real substance, including mind and management, key staff and appropriate systems. Shared or flexible office options exist for some smaller firms. A purely nominal presence is not acceptable for regulated activities. Substance also matters for tax residence, banking relationships and investor confidence, so we plan it at the start alongside the business plan, staffing model and budget for the first years of operation.
Can a Bangladeshi resident be an approved individual at a DFSA firm?
A Bangladeshi national may be approved for a controlled function if they meet the DFSA's fitness and propriety, competence and residency expectations for that role, which for some functions require being based in the UAE. Individuals who remain resident in Bangladesh should consider their own Bangladesh tax and regulatory position, especially if the firm deals in crypto tokens, given Bangladesh Bank's stance on virtual currencies. Contracts, board roles and any personal holdings of digital assets should be reviewed before appointment.
How do anti-money laundering rules apply to DIFC digital assets firms?
DFSA firms must comply with UAE federal anti-money laundering and counter-terrorist financing law and the DFSA's own anti-money laundering module, including risk assessment, customer due diligence, sanctions screening, monitoring, travel rule data for crypto transfers and suspicious transaction reporting to the UAE Financial Intelligence Unit. Customers and flows linked to Bangladesh may require specific risk assessment and documentation. Firms handling digital assets also need blockchain analytics and clear procedures for wallets that cannot be identified, because the DFSA expects those risks to be managed.
Can a fintech start in the DIFC without a DFSA licence?
Some businesses, such as pure technology providers that do not carry on financial services, may operate in the DIFC under a non-financial licence. However, the boundary between technology and regulated activity can be narrow, especially for platforms that arrange transactions, hold client assets or provide advice. Operating without a required licence is a serious breach. We analyse the activity before launch to confirm which side of the line it falls, and revisit that analysis when new features or digital assets services are added.
What tax issues arise for Bangladeshi shareholders?
Bangladeshi resident shareholders are generally taxed in Bangladesh on worldwide income and must disclose overseas assets in their returns. Dividends, gains and salary from a DIFC company may therefore have Bangladesh tax consequences, and any double tax treaty relief depends on the facts. Outward investment approvals and remittance rules also matter. We work with tax advisers so that the structure is efficient and compliant on both sides, and so that shareholders can document lawful sources of funds when they later remit income home.
How can TRW help with DFSA authorisation?
We analyse the regulatory perimeter, design structures for Bangladesh-linked founders and investors, coordinate Bangladesh Bank, tax and regulatory questions, and support preparation of DFSA applications with DIFC counsel. After authorisation we assist with compliance, transactions, supervisory matters and disputes involving digital assets, tokenisation, payments and wider fintech services, with a consistent view across Bangladesh, the UAE and other jurisdictions.

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