emirates7 - The Dubai Financial Services Authority (DFSA), the independent regulator of the Dubai International Financial Centre (DIFC), released a new report on Monday titled “Cyber and Artificial Intelligence Risk in Financial Services: Strengthening Oversight Through International Dialogue.”
This report offers timely insights into the rapidly evolving digital risk environment, focusing on how cutting-edge technologies like Artificial Intelligence (AI) and quantum computing—which can solve complex problems much faster than traditional computers—are reshaping regulatory priorities.
The publication follows the DFSA’s first-ever Cyber and AI Risk Regulatory College held in May 2025, which gathered 70 senior officials from 18 financial regulatory bodies across the Middle East, North America, Europe, Africa, and Asia. The College provided a platform for international discussion on the increasing complexity and interconnectedness of cyber risks, AI adoption, and the long-term consequences of quantum computing.
Justin Baldacchino, Managing Director of Supervision at DFSA, stated, “Digital risks have moved from being peripheral concerns to systemic threats. This report reflects a growing consensus among supervisors about where these risks intersect and how regulatory approaches are adapting. We were honored to host our inaugural Cyber and AI Risk Regulatory College and are committed to ongoing meaningful dialogue with both regional and global counterparts to support a secure, resilient, and trustworthy global financial system.”
The report examines supervisory views on three interconnected areas: the cybersecurity threat landscape, quantum computing, and emerging AI risks. It incorporates global expertise and discussions on how financial regulators can manage emerging risks while fostering innovation.
Key points emphasized include the rising frequency and sophistication of cyberattacks, including those linked to emerging technologies and vulnerabilities in supply chains.
The report also highlights the threat posed by quantum computing potentially breaking current encryption methods in critical communication systems, underlining the need for early, coordinated efforts on post-quantum cryptography—encryption techniques designed to withstand quantum attacks.
Additionally, the increasing use of AI in financial services stresses the need for improved explainability and interpretability, stronger oversight of third-party risks, and responsible governance frameworks.
Herman Schueller, Director of Innovation and Technology Risk Supervision at DFSA, added, “As innovation speeds up, financial regulators worldwide are actively exploring how to best oversight practices. This report underscores the importance of open, cross-border collaboration to develop a shared understanding of the regulatory, technical, and operational challenges related to digital risks.”
This report offers timely insights into the rapidly evolving digital risk environment, focusing on how cutting-edge technologies like Artificial Intelligence (AI) and quantum computing—which can solve complex problems much faster than traditional computers—are reshaping regulatory priorities.
The publication follows the DFSA’s first-ever Cyber and AI Risk Regulatory College held in May 2025, which gathered 70 senior officials from 18 financial regulatory bodies across the Middle East, North America, Europe, Africa, and Asia. The College provided a platform for international discussion on the increasing complexity and interconnectedness of cyber risks, AI adoption, and the long-term consequences of quantum computing.
Justin Baldacchino, Managing Director of Supervision at DFSA, stated, “Digital risks have moved from being peripheral concerns to systemic threats. This report reflects a growing consensus among supervisors about where these risks intersect and how regulatory approaches are adapting. We were honored to host our inaugural Cyber and AI Risk Regulatory College and are committed to ongoing meaningful dialogue with both regional and global counterparts to support a secure, resilient, and trustworthy global financial system.”
The report examines supervisory views on three interconnected areas: the cybersecurity threat landscape, quantum computing, and emerging AI risks. It incorporates global expertise and discussions on how financial regulators can manage emerging risks while fostering innovation.
Key points emphasized include the rising frequency and sophistication of cyberattacks, including those linked to emerging technologies and vulnerabilities in supply chains.
The report also highlights the threat posed by quantum computing potentially breaking current encryption methods in critical communication systems, underlining the need for early, coordinated efforts on post-quantum cryptography—encryption techniques designed to withstand quantum attacks.
Additionally, the increasing use of AI in financial services stresses the need for improved explainability and interpretability, stronger oversight of third-party risks, and responsible governance frameworks.
Herman Schueller, Director of Innovation and Technology Risk Supervision at DFSA, added, “As innovation speeds up, financial regulators worldwide are actively exploring how to best oversight practices. This report underscores the importance of open, cross-border collaboration to develop a shared understanding of the regulatory, technical, and operational challenges related to digital risks.”