Qatar Unveils New Regulatory Framework for Cryptocurrency, Transitioning from Ban to Legal Recognition

Qatar has made a significant shift in its approach to cryptocurrency. In just a few years, it went from banning crypto in 2018 to introducing a new regulatory framework this month.

This framework covers several important areas. It recognizes smart contracts, provides licenses for crypto companies, and establishes property rights for tokens. It also addresses custody arrangements.

The Qatar Financial Centre (QFC) is leading this effort. They launched the Digital Asset Regulations 2024 to create a solid legal foundation for digital assets. This includes tokenization processes and the legal recognition of property rights in tokens and their underlying assets. They also set rules for custody, transfer, and exchange.

This new framework marks a big change from the previous ban. Last year, Qatar began a public consultation process, and many expected regulations to come by the end of this year.

Yousuf Mohamed Al-Jaida, the CEO of QFC, stated, “We anticipate that this regulatory clarity will attract both domestic and international players, boosting Qatar’s financial services sector competitiveness.”

These regulations are the result of discussions with a variety of stakeholders. An advisory group of 37 domestic and international organizations helped shape the framework. Over 20 startups and fintech firms participated in tests that started in October 2023, contributing to its development.

Navandeep Matta, a senior associate at Kochhar & Co. Legal, pointed out, “Compared to other Middle Eastern countries, Qatar’s approach is notably advanced. It offers a more structured and clear regulatory environment.” This positions Qatar alongside the UAE’s Digital Assets Framework, creating a strong regulatory regime that aligns with international best practices.