Qatar has gone from banning crypto in 2018 to introducing a crypto regulations framework this month.

The framework includes recognition of smart contracts, licensing for crypto companies, property rights in tokens and custody arrangements among other issues.

Qatar introduced a regime to regulate digital assets, opening the way for companies to obtain licenses as token service providers and help develop the country’s digital financial economy.

The Qatar Financial Centre (QFC), which provides legal services for local and international companies, brought in the Digital Asset Regulations 2024 to establish the “legal and regulatory foundation for digital assets, including the process of tokenization, legal recognition of property rights in tokens and their underlying assets, custody arrangements, transfer, and exchange,” it said Sunday.

The framework, which also legally recognizes smart contracts, marks a shift from an earlier policy typified by a 2018 ban on crypto. Qatar began a public consultation process last year and regulation was expected by the end of the year.

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

The regulation is the result of discussions with stakeholders, coordinated through an advisory group of 37 domestic and international organizations. More than 20 startups and fintech firms have taken part in tests that began in October 2023 to help develop the framework.

“As compared to other Middle Eastern countries, Qatar’s approach is notably advanced, offering a more structured and clear regulatory environment,” said Navandeep Matta, a senior associate at Kochhar & Co. Legal. “This positions Qatar at par with the UAE’s Digital Assets Framework, establishing a robust regulatory regime that aligns with international best practices.”