Abu Dhabi’s virtual assets regulator First MENA regulator to allow NFT trading

Abu Dhabi’s virtual assets regulator First MENA regulator to allow NFT trading

UAE virtual asset regulator in Abu Dhabi,  FSRA (Financial Services Regulatory Authority) of ADGM ( Abu Dhabi Global Market) has enhanced its capital markets framework, allowing for the trading of NFTs  (Non Fungible tokens) on virtual asset regulated platforms, This means that MTFs/Custodians (Multilateral trading Facilities) operating within ADGM are now able to seek approval from the FSRA to engage in Non-Fungible Token (NFT) activities.

As per the news, these are considered significant enhancements to its capital markets framework, across spot commodities, securities, derivatives, benchmarks, environmental instruments and virtual assets that will further improve on its innovative and progressive regime and leadership in financial markets.

Alongside its innovative approach to virtual assets, the ADGM has now implemented its regulatory framework for spot commodity and environmental instrument activities, making it the first international financial centre in the MENA region to do so

Ahmed Jasim Al Zaabi, Chairman of the ADGM, said, “The ADGM wishes to thank all those who responded to the consultation paper released earlier this year. The degree of interest shown in the consultation, as well as the keen interest by participants looking to undertake activities in these significant new areas, is hugely positive. Collectively, the ADGM and its market participants continue to provide regulatory and industry leadership, positioning the ADGM and Abu Dhabi as the jurisdiction of choice. These enhancements to our capital markets framework will unlock the next stage of investment and growth opportunities, across commodities, environmental instruments, virtual assets activities and wider financial markets.”

Prior to this announcement, ADGM’s FSRA had also announced that stablecoins could now be traded on virtual asset platforms. As they stated, ADGM will only permit those tokens where price stability is maintained by the issuer holding the same fiat currency it purports to be tokenizing on a fully backed 1:1 basis. This therefore currently prevents the use within ADGM of other types of stablecoins, such as algorithmic stablecoins.

While VARA (Virtual Assets Regulatory Authority) based out of Dubai continues to license virtual asset exchanges such as Binance with full licenses, it has yet to set its framework for the regulation of NFTs or stablecoins.

Despite this the UAE remains one of the most advanced virtual asset regulated hubs globally.

Abu Dhabi’s ADGM publishes virtual asset regulatory guidelines

Abu Dhabi’s ADGM publishes virtual asset regulatory guidelines

Abu Dhabi Global Market (ADGM), the International Financial Centre in Abu Dhabi, announced that its financial regulator, the Financial Services Regulatory Authority (FSRA), has published Guiding Principles on its approach to virtual asset regulation and supervision as a way to outline its expectations for the asset class and service providers in the sector.

The principles state the FSRA’s risk appetite and priorities for the sector, with each principle covering one of the key pillars of ADGM’s holistic approach, which includes a robust and transparent regulatory framework; high standards of authorization; preventing money laundering and other financial crimes; risk-sensitive supervision; enforcement powers for regulatory breaches; and its commitment to international cooperation. They will therefore be of particular relevance to potential applicants to ADGM and other regulators with an interest in this area.

As per the document, The FSRA’s risk appetite for VA activities is such that it will only admit operators to its jurisdiction who at the outset can unequivocally meet the transparent, high standards outlined in its framework. This will maintain the best-in-class reputation of the ADGM ecosystem and instil market confidence to promote growth and investment. 

In addition the document discusses stablecoins, ADGM will only permit those tokens where price stability is maintained by the issuer holding the same fiat currency it purports to be tokenising on a fully backed 1:1 basis. This therefore currently prevents the use within ADGM of other types of stablecoins, such as algorithmic stablecoins.

Emmanuel Givanakis, CEO of the FSRA, said, “These guiding principles will provide greater clarity to investors, other regulators, industry and the wider public of our approach to regulation in this area and key expectations we have set on current virtual asset service providers in ADGM and potential applicants. They also outline the tools we have at our disposal to mitigate the material risks that are born from these activities and the regulatory powers to identify and act upon any misconduct. Consistent with the FSRA’s broader strategy to align with international best practices, these principles make clear the high standards of our framework at a time of increased volatility and regulatory focus.”

Abu Dhabi UAE now has a crypto vending machine a first in the UAE

Abu Dhabi UAE now has a crypto vending machine a first in the UAE

The Abu Dhabi Global Market has launched a crypto vending machine in the free zone area. Users can insert cash or credit card and exchange them for Bitcoin or other crypto currencies. Located in the Galleria Mall, on Al Maryah Island next to ADGM. 

As per an article in the National, ADGM stated, ” the Kiosk withdrawal is logged via the internet and the puchsed Bitcoins are added to the customer’s virtual currency wallet for use in future transactions.” 

The crypto Kiosk or vending machine is an initiative of World Credit savings a brokerage firm regulated by the FSRA ( Financial Services Regulatory Authority) at ADGM. 

This is a big thing given that the last Crypto ATM set up in Dubai was decommissioned in 2019. It was a Bitcoin ATM in the Rixos Premium hotel. 

In 2019 there was  only one Bitcoin ATM in existence in the GCC in Bahrain.  In a Linkedin Post shared by the CEO of Bahrain Fintech bay Khalid Saad states, ” We have the only live Crypto ATM in the MENA region in Bahrain Fintech Bay. The Crypto ATM is run by Basket and backed by Kuwait entrepreneur Jamal Al Mutawa.” He adds, ” Basket is currently testing their solution under the Central Bank of Bahrain’s regulatory sandbox. this is a great addition to Bahrain’s growing crypto ecosystem.” Later on nothing came out of it.