Abu Dhabi’s crypto and blockchain businesses are expected to grow exponentially and attract international investors, more so from the United States.
The registration authority of Abu Dhabi Global Market (ADGM) has issued a consultation paper seeking feedback on its proposed new framework for distributed ledger technology (DLT) market and token issuance. The regulatory authority has set Friday, May 12 as the deadline for providing feedback on the proposed legal framework. Afterward, the regulatory agency will review the feedback and later the ADGM Board of Directors will present the final form of the legal proposal.
The initiative comes amid the rise of the decentralized economy both in Abu Dhabi and at the international level. With the regulatory framework having jurisdictions in the international finance center within the United Arab Emirates (UAE), the authority is keen to attract investors in the decentralized market.
“ADGM has received interest concerning the use of ADGM foundations for DLT purposes and the issuance of non-regulated utility tokens. However, whilst foundations are inherently well suited to DLT projects, certain features and requirements within our current foundation’s regimes impose constraints that are not desirable for DLT projects,” the proposal noted.
Dubai as a Blockchain and Crypto Hub
The United Arabs Emirates has been working towards becoming a favorable investment hub for blockchain-related companies. Earlier this year, Dubai set out plans to allow crypto companies to obtain relevant operational licenses. Under the new licensing mandate, all aspiring crypto businesses in Dubai are expected to seek the approval of the Virtual Assets Regulatory Authority (VARA).
“With bespoke rules and guidelines designed to provide clarity, assure certainty, and mitigate market risks, VARA seeks to develop a model framework for global economic sustainability within an innovation-centric environment that is truly borderless, technology agnostic, and future-focused,” the regulator noted.
The Virtual Assets Regulatory Authority issued several orders on crypto asset advertising. In this regard, the country was keen to protect investors from exploitative businesses and at the same time provide a conducive environment for technological innovation. Furthermore, blockchain technology has been developed to upgrade the traditional financial sector and meet the growing demand for fast, secure and reliable payments. Notably, the UAE is keen to attract crypto companies from the United States that are fleeing hostile takeover by the SEC. For instance, Coinbase Global Inc (NASDAQ: COIN) in its latest quest to diversify to the global market has sought after the Dubai crypto licenses.
Other notable crypto investors already in the Dubai market include Binance and Ripple Labs. As a result, the local authority has been able to deliver on job creation and economic expansion projects.
The overall winner in Abu Dhabi’s blockchain adoption is Bitcoin and the rest of the crypto market which has a valuation of approximately $1.2 trillion. With the European Union already pro-crypto, other global countries are expected to enact accommodative blockchain policies. As a result, next year’s halving event which brings forth a fresh crypto bull market will encompass more mainstream markets.
Cryptocurrency news, News
Let’s talk crypto, Metaverse, NFTs, CeDeFi, and Stocks, and focus on multi-chain as the future of blockchain technology.
Let us all WIN!