Dubai: The Dubai Financial Services Authority (DFSA), the independent regulator of the Dubai International Financial Centre (DIFC), published its latest report, 'Cyber and Artificial Intelligence Risk in Financial Services: Strengthening Oversight Through International Dialogue'. The report provides timely insights into the evolving digital risk landscape and explores how emerging technologies such as Artificial Intelligence (AI) and quantum computing are reshaping regulatory priorities.
According to Emirates News Agency, the publication follows the DFSA's inaugural Cyber and AI Risk Regulatory College, held in May 2025, which brought together 70 senior representatives from 18 financial authorities across the Middle East, North America, Europe, Africa, and Asia. The College served as a platform for international dialogue on the increasing complexity and interconnection of cyber risks, AI adoption, and the long-term implications of quantum computing.
Justin Baldacchino, Managing Director of Supervision at DFSA, stated that digital risks are becoming systemic and emphasized the importance of the report reflecting a growing supervisory consensus on converging risks and evolving regulatory approaches. He expressed pride in hosting the Cyber and AI Risk Regulatory College and anticipated ongoing dialogue with regional and international peers to support a secure, resilient, and trusted global financial system.
The report delves into supervisory perspectives on cybersecurity threat landscape, quantum computing, and AI emerging risks. It draws on global insights and expert discussions on how financial regulators can respond to emerging risks without stifling innovation.
Key themes highlighted include the increasing frequency and sophistication of cyberattacks, including threats from emerging technologies and supply chain dependencies. It also addressed the potential for quantum computing to render current encryption obsolete, stressing the importance of early coordinated planning around post-quantum cryptography.
Furthermore, the report noted the growing adoption of AI across financial services, highlighting the need for enhanced explainability and interpretability methods, robust third-party risk oversight, and responsible governance.
Herman Schueller, Director of Innovation and Technology Risk Supervision at DFSA, commented on the global examination of oversight practices by financial regulators in response to accelerating innovation. He underscored the value of open, cross-border dialogue in building mutual understanding of the regulatory, technical, and operational dimensions of digital risks.
