Abu Dhabi Global Market Releases A Regulatory Framework For Cryptocurrency Activities
Recently, the financial authority of Abu Dhabi Global Market has launched a regulatory framework for cryptocurrency activities after the completion of a public consultation. The market’s financial supervisor also published a guideline explaining how crypto assets activities are now regulated.
This week, the Abu Dhabi Global Market (ADGM) made public that it has launched a ‘framework to regulate spot crypto asset activities, including those undertaken by exchanges, custodians and other intermediaries in ADGM. The Abu Dhabi Global Market is the international financial center in Abu Dhabi which collaborates with financial centers, institutions, and regulators “to develop and support member institutions with the regulatory framework, legal jurisdiction and attractive business environment they need for sustainable business growth,” it notes on the agency’s website. The Financial Services Regulatory Authority (FSRA) is the supervisor of the market.
The ADGM wrote, “The framework is designed to address the full 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.”
This new regulatory framework comes after the completion of a public consultation on the introduction of a crypto regulatory framework by the FSRA on the 28th of May. Some of the public commented that “several refinements have been made to the regulatory framework, with a key chance being the implementation of the daily value trading levy imposed on crypto asset exchanges on a sliding scale basis.”
The CEO of ADGM’s FSRA, Richard Teng stated: “By introducing a comprehensive and best-in-class regulatory framework, the FSRA is taking a leading role in instilling proper governance, oversight and transparency over crypto asset activities, positioning ADGM as a destination of choice for crypto asset players.”
Media outlet Reuters reported that back in February the FSRA stated that “virtual currencies, although not legal tender, are gaining interest globally as a medium of exchange for goods and services.” In addition to the new regulatory framework, the FSRA has also published a 34-page guideline for the regulation of crypto asset activities in ADGM. This guide detailed the regulatory framework for crypto assets including the requirements for operating a crypto asset business, exchange or custodian. The guide notes “Applicants that qualify for authorization under the Spot Crypto Asset Framework will be granted an FSP (Financial Service Permission) to carry on the regulated activity of OCAB (Operating a Crypto Asset Business).” The document also clarifies that this framework does not apply to initial coin offerings (ICOs). Back in October of last year, the FSRA published a separate guidance for ICOs.
