ADGM introduces new crypto asset regulations
Priya Wadhwa
10X Technology

ADGM introduces new crypto asset regulations

Takes a leading role in digital securities regulation.

Abu Dhabi Global Market (ADGM) has launched a regulatory framework today for "spot crypto asset activities" including those that are undertaken by exchanges, custodians and other intermediaries in ADGM.

The new crypto framework introduces proper governance, oversight and transparency over crypto asset activities.

This new framework has been developed and announced following an in-depth public consultation relating to the introduction of a robust crypto asset regulatory framework by ADGM in 2018.

It has been designed to address the complete range of risks associated with crypto asset activities, including risks relating to money laundering and financial crime, consumer protection, technology governance, custody and exchange operations.

“The FSRA’s Guidance on Digital Securities provides technologically advanced industry players with the transparency and certainty required to effectively operate in a best-in-class regulatory environment.
Richard Teng, CEO, FSRA of ADGM

Ahmed Al Sayegh, UAE Minister of State and Executive Chairman of ADGM, commented on the launch of the framework, “It is important that we continue to stay ahead of the curve, as a progressive nation and economy, by responding to the dynamic needs of our local environment and anticipating the developments and impact of the global marketplace."

He added, "As an international finance centre, ADGM has been actively playing a strategic role in creating new financial opportunities and initiating unique business propositions that benefit our local businesses and global partners.”

[The latest framework is a] road map for entities to efficiently and smoothly migrate into conducting digital securities activities.
Cryptocurrency regulation is one of the biggest challenges that lacks clarity within the Gulf region. Startups and SMEs face many hurdles in knowing how they can go about being regulated. By addressing this lack of framework, ADGM is playing a leading role in the cryptocurrency and blockchain sector, and will certainly attract many startups with strong blockchain business plans to set up within its freezone.

Many blockchain asset-based startups have set up in Abu Dhabi and gained investor support. Abu Dhabi's Mubadala is also one of the leading investors supporting the new digital securities sector. It recently injected capital in MidChains, a blockchain startup based in Hub71.