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.

Select UAE Local bank customers can now trade with Binance in Dubai

Select UAE Local bank customers can now trade with Binance in Dubai

Binance, crypto exchange has received its Minimal Viable Product (MVP) license from Dubai’s Virtual Asset Regulatory Authority (VARA). Local bank clients approved by VARA will be able to utilize the Binance platform. Users will benefit from higher consumer protection levels because Binance is now a fully regulated platform in Dubai.

Binance is now able to open a client money account with a UAE local bank and provide services to qualified customers. Services include, virtual asset exchange services, conversion between virtual assets and fiat currencies, transfer of virtual assets, custody and management of virtual assets, virtual token offering and trading services and virtual assets payments and remittance services

His Excellency Helal Saeed Almarri, Chairman of VARA said, “We are pleased to have Binance licensed to operate within the VARA MVP Programme. The VARA regime aims to strike an effective balance between value creation and risk mitigation, enabling open market innovation while assuring protection for the economically vulnerable. The MVP Phase, is designed for select global players across the value chain, that are committed to responsible industry participation and VARA looks forward to Binance being an active contributor, reinforcing Dubai’s commitment towards creating a next-gen secure ecosystem for this future economy.”

Changpeng Zhao (CZ), founder and CEO of Binance, commented: “At Binance we welcome regulations that are globally consistent, enable responsible innovation, protect users, and give them choice. VARA’s unique operating model is setting a benchmark for the global industry, and this most recent registration is an acknowledgement of our compliance and safety processes in the new regulatory framework.  We strongly believe there is a significant opportunity to work with our industry peers to develop consistent implementation standards around the world as we have been doing in Dubai.”

Alexander Chehade, Binance Dubai General Manager, noted: “Our registration in Dubai is a reflection of the country’s progressive stance on blockchain technology and its willingness to embrace this sector through collaboration. We look forward to continued partnership as we build upon our team and operations in Dubai to roll out additional services including local banking capabilities and enhanced products.”

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.”

UAE ADGM grants Klickl a digital asset dealer and custodian preliminary license

UAE ADGM grants Klickl a digital asset dealer and custodian preliminary license

UAE ADGM (Abu Dhabi Global Market) has granted Klickl, a virtual asset service provider with offices in Hong Kong and Abu Dhabi, an in principle Approval license to operate as a digital asset broker and custodian.

Michael Zhao, Co-Founder and CEO at Klickl said “The regulated route is the only route for any crypto company’s growth if it wants to be a serious player for the long run.  Long gone are the days where digital asset players enjoy early-mover advantage benefiting from fast growing bull market. Recent crypto market turbulence and big selloff caused by greed-led FOMO driven sentiment is just another example to show why the market needs proper risk control and compliance.”

Formerly known as IDCM, the digital asset exchange group recently rebranded to Klickl representing the sound coins make when clicking in harmony and prosperity.

Klickl aims to deliver that All-in One crypto super app which serves all crypto needs in the ever-evolving digital era.

ADGM has approved license for more than seven virtual asset exchanges to operate in the UAE. The names include Binance, Kraken, as international players, and BitOasis, Midchains, Matrix and others as local ones.

The UAE has become a blockchain and crypto hub and one of the leading regulated environments across the globe. This has attracted crypto entities that were previously headquartered in Hong Kong and Singapore among others.

New rules govern how virtual assets are marketed in Dubai

New rules govern how virtual assets are marketed in Dubai

Dubai’s Virtual Asset Regulatory Authority (VARA), with the commencement of its Minimum Viable Product (MVP) Phase, has announced Regulatory Guidelines on Marketing, Advertising and Promotions of VA across the Emirate of Dubai.

The new VARA regulations specifically address marketing and communications activities, ahead of operationalizing the MVP licensees so that any mass-market information dissemination and consumer solicitation are designed to safeguard community interests.

Regulations on Marketing, Advertising and Promotions of Virtual Assets cover all forms of outreach, communications and advertising, including publication of information, awareness building, customer engagement, and/or investor solicitation.

VARA rules extend to VA related communications by any entity leveraging Dubai-based media sites, search platforms, and online or off-line publishing channels that explicitly target customers within the Dubai market, establishing guardrails on permissible audience segments, in addition to content obligations.

Equally all content dissemination channels operating from Dubai are obligated to act responsibly, and ensure compliance with prevailing Guidance as it pertains to VA communications facilitated via their platforms.

VARA guidelines further detail the obligations of Dubai licensed VASPs and any advertising platforms that are positioning VA content across traditional and new-age media channels for the Dubai market, to ensure factual accuracy, explicitly demonstrate any promotional intent, and in no way mislead on the guaranteed nature of their returns.

The principles are supplemented by rigid enforcement standards and penalties for non-compliance that collectively provide market confidence ahead of MVP operations, as it augments marketing, data protection and consumer protection laws that have been well embedded across the UAE.

Abu Dhabi launches blockchain and virtual asset committee to grow ecosystem

Abu Dhabi launches blockchain and virtual asset committee to grow ecosystem

Abu Dhabi has launched the Abu Dhabi blockchain and virtual assets committee. The Abu Dhabi Blockchain and Virtual Assets Committee is comprised of representatives of major entities and stakeholders active in this field including Dhaher bin Dhaher Al Mheiri, CEO of Abu Dhabi Global Market (ADGM) Registration Authority, Wai Lum Kwok, Senior Executive Director Authorization at ADGM, Mohammed Kaissi, Director of Strategic Projects at ADQ, Faisal Al Hammadi, Executive Director Incubation at ADQ, H.E. Mohamed Jameel Al Ramahi , CEO of Masdar, Dr. Nikolas Meitanis , Advisor at Masdar CEO Office,  Ibrahim Ajami, Head of Ventures and Growth at Mubadala, Eng. Abdulla Al Shamsi, Director General of Abu Dhabi Investment Office (ADIO), and  H.E. Dr. Maryam Buti Al Suwaidi, CEO of Securities and Commodities Authority (SCA).

During the first meeting of the committee, under the chairmanship of H.E Mohamed Ali Al Shorafa, Chairman of the Abu Dhabi Department of Economic Development (ADDED) and Chairman Securities and Commodities Authority (SCA), discussed the aim of launching the committee which is to develop the strategy for blockchain and virtual assets,  aligned with the Emirates economic strategy.

The Committee emphasized the importance of regulating blockchain and virtual asset activities to comply with Anti Money Laundering/Combating the Financing of Terrorism (AML/CFT) International and local rules and regulations. This in turn will build an ecosystem that is safe, sound, and transparent, which will help build trust and attract more companies to Abu Dhabi.

As per the press release, the Committee is established to improve Abu Dhabi’s competitiveness in blockchain and virtual asset space, coordinate efforts of entities active in the industry, liaising with regulators, and promoting compliance of industry participants with global standards and regulatory requirements, particularly AML/CFT regulations, as well as supporting exchange of information and best practices.

H.E Mohamed Ali Al Shorafa, Chairman of ADDED and SCA, said; “The formation of Abu Dhabi’s Blockchain and Virtual Assets Committee reflects our leadership farsighted vision and approach, which enabled Abu Dhabi to nurture a supportive business environment, unparalleled connectivity and infrastructure and an entrepreneurial mind-set that presents investors with growth opportunities. The Committee is bringing together all the relevant stakeholders to build a robust, credible, and comprehensive regulatory and business ecosystem that addresses key risks and major governance issues, such as AML/CFT, investor protection, tech governance, and custody risk, to promote blockchain and virtual assets.”

He added, “This will allow us to capitalize on blockchain technology and virtual assets to achieve Abu Dhabi’s aspirations, and the priority areas for this will be growth clusters including AgriTech, FinTech, Healthcare and Biopharma, Energy, Tourism, and ICT as we aim to foster businesses in these sectors to expand and accelerate”.

Cementing UAE as a digital economy both organically and internationally

Cementing UAE as a digital economy both organically and internationally

UAE is building its digital economy organically by educating its government employees as well as acquiring it internationally by attracting international tech players and their talents. Not only has the country come out with a new initiative to attract 300 global tech firms, but it is also working with Chainalysis to train its government employees on all things blockchain and crypto (virtual assets).  

In recent news announced, Minister of State for foreign trade, Thani Bin Ahmed Al Zeyoudi, launched the “NextGenFDI” that aims to attract 300 global tech firms as well as software developers, data scientists, and coders.

The start of the initiative is through partnerships already inked out with seven major firms and business districts that include Abu Dhabi Global Market (ADGM) and Dubai International Financial Centre (DIFC),  Dubai South, DMCC,  Dubai Internet City, Emirates NBD and digital bank WIO.

Al Zeyoudi said international businesses “are approaching us and asking how they can relocate their talent, ideas, and high-growth ventures to the UAE.  The global interest in 2022 is unprecedented and while we are already working with some, we know many more want to follow suit. We want to ensure that the world’s most promising digital companies can access all the benefits that our attractive, business-friendly environment offers – but we also want to make it easy for them.”

The minister said they are introducing measures to make market entry for companies and workers simpler. These include fast incorporation processes to speed up licensing, bulk visa issuances, banking facilitation and commercial and residential lease incentives.

This is in line with UAE’s establishing 1,000 new digital companies and increase investments in startups from $400 million to $1.3 billion.

But that is not all, on the governmental front, UAE Minister of State for Artificial Intelligence, Digital Economy, and teleworking applications, Omar Bin Sultan Al Olama signed an MOU with Bas Lemmens, General Manager for EMEA at Chainalysis to provide virtual training programs for government employees in the areas of Blockchain and virtual assets.

For those who don’t know Chainalysis, it provides data, software, services, and research to government agencies, exchanges, financial institutions, insurance and cybersecurity companies in over 70 countries. Their data platform powers investigation, compliance, and risk management tools that have been used to solve some of the world’s most high-profile cyber-criminal cases and grow consumer access to cryptocurrency safely.

This would allow employees to develop their skills. Al Olama stated that strengthening partnerships with pioneering companies and empowering government entities with the latest tools and advance technologies play a pivotal role in enhancing the readiness of the UAE government, through exchanging experiences and global success stories. Blockchain technology is key to creating innovative solutions for future challenges, which contributes to developing government work and new technologies that enhance the UAE’s leading position globally, he added.

The MoU also aims to enhance the utilization of Blockchain technologies in building a smart future for the UAE.

Michael Gronager, CEO and Co-Founder of Chainalysis, said, “We are honored to be selected by the UAE to play a supporting role in up skilling government entities through knowledge in Blockchain that have the potential to serve as one of the essential digital tools in promoting a robust digital economy.”

Bas Lemmens, added “We are very proud to partner with the UAE government in supporting its initiatives in adopting blockchain, analysis tools and training through the ‘UAE Chainalysis Centre of Excellence’ to implement new technologies that will help drive new business opportunities. We want to build trust in blockchains and drive the adoption of digital assets.”

As of today there are more than 1000 blockchain and crypto companies who have set up in UAE. With these initiatives this number is 

Oman New Securities Law provisions for regulation of virtual assets

Oman New Securities Law provisions for regulation of virtual assets

Oman Capital Market Authority recently issued its new Securities Law (46/2022) which  stipulates that the authority can “Agree to application of technologies, virtual digital investments or any products or services in the areas related to the provisions of this law, as set out in the Regulation.”

In an article in Oman Observer, Sheikh Abdullah Bin Salim Al Salmi, Executive President of the  Oman Capital Market Authority states, “ The law will contribute to the growth of FinTech based services as the law authorizes the authority to regulate innovative financing, approval of FinTech based apps and virtual investments. The law also allows expanding the financing options by regulating new products and services.”

In March of 2022, Oman Capital Markets Authority (CMA), invited companies interested in helping it set up a regulatory framework for virtual assets to participate in a tender process. According to sources, the regulatory framework should be finalized by Q3 of 2022.

The new Securities Law is only further proof of the commitment Oman government and Capital Market has for developing its virtual assets framework and allowing the trade and investment in virtual assets in the future. This could pave the way for security token issuances in the Oman stock market a bold step into the future of investments and stock trading.