UAE Financial Authority Unveils Cryptocurrencies Regulations


United Arab Emirates financial authority the Abu Dhabi Global Market has issued a new framework that will be used to regulate cryptocurrencies activities following completion of public consultation. The new regulations will govern activities and operations undertaken by exchanges, custodians as well as intermediaries.

The framework seeks to address all the risks involved in the handling of crypto assets pertaining to things like money laundering, financial crime, consumer protection and technology governance. According to ADGM CEO, Richard Teng, the best in class regulatory framework is designed to position ADGM as a destination of choice for crypto asset players.

?We are encouraged by the significant global and regional interest from exchanges, custodians, intermediaries and other institutions to our crypto spot regulatory framework. Globally, responsible crypto asset players are seeking a regulatory regime upholding high standards that foster market confidence,? said Mr. Richard Teng, Chief Executive Officer, FSRA of ADGM

According to the ADGM, the new regulations should go a long way in fostering a safer and thriving marketplace at a time when cryptocurrencies are facing an uncertain future. The Financial Services Regulatory Authority of the ADGM has classified cryptocurrencies or crypto assets as commodities.

ADGM Cryptocurrency Regulations

Security tokens issued will be subject to relevant regulatory requirements while utility tokens will be classified as commodities. Derivatives or off-shoot funds generated from crypto assets or tokens are to be regulated as Specified investments under FSRA regulations.

Under the new regulations, people looking to establish cryptocurrency exchange in the kingdom will have to pay an initial authorization fee of $125,000 accompanied by an annual fee of $60,000. Firms operating digital wallets, on the other hand, will have to cough up $20,000 at the start and $15,000 annually.

The regulator has also imposed a monthly levy, based on the average transaction an exchange handles. Exchanges that handle average transaction value of less than $10 million will have to contend with a levy of 0.0015% capped at a minimum of $15,000 a month. Exchanges with an average daily volume of more than $250 million will have to pay the FSRA 0.0006%, a minimum of $150,000.


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