KEY POINTS

  • ADGM granted Havyn a regulatory permission in December
  • Kraken secured a license to operate in Abu Dhabi from ADGM in April
  • Binance secured a license for the same from FRSA

The cryptocurrency industry experienced an unprecedented crisis this year caused by massive hacks on various crypto businesses, the collapse of Terra in May, and the implosion of FTX just recently. Despite this, the Abu Dhabi Global Market (ADGM) is bullish as it launches the Abu Dhabi Crypto Hub.

Launched during the Abu Dhabi Finance Week, the Abu Dhabi Crypto Hub is a web-based platform that offers users access to information as it links with the financial center's existing virtual asset firms.

"Given the rapid emergence of new virtual assets such as cryptocurrencies and other related assets, ADGM is leading the way to introduce progressive frameworks and regulations around these technologies and developments," the ADGM said.

The latest project is considered a milestone for the United Arab Emirates (UAE) in its plan to become a hub for cryptocurrency. The launch of the Abu Dhabi Crypto Hub is "an important representation of the strategic initiatives taken by ADGM in support of economic diversification and the growing role of Abu Dhabi as a financial hub, addressing the current and future needs of the market through innovative technologies," the ADGM noted.

The Financial Services Regulatory Authority (FSRA), which regulates Abu Dhabi's financial hub, released a list of guiding principles on its approach to digital asset supervision and regulation in September. These principles complement the regulatory framework of the ADGM for activities like spot virtual assets, the FSRA said at the time.

Crypto assets are trading in red of late because of the surprising collapse of FTX, which triggered retail investors to pull out their investments in cryptocurrency exchange platforms and instead store their assets in cold wallets.

Several major players in the industry with exposure to FTX feel the heat and are looking for viable solutions to make up for whatever damage the implosion caused.

CZ, the CEO and co-founder of Binance, the world's largest cryptocurrency exchange, attended the Abu Dhabi Finance Week. The crypto executive assured the audience of the promising future of the crypto industry.

ADGM wants to entice major crypto businesses to set up a base in the country's regulated financial-free zone. It granted regulatory permission to Hayvn, a virtual asset trading platform, in December 2021.

In April, Kraken, one of the major CEXs in the world, secured a license from ADGM to operate its platform in the country. Binance has also secured its license to operate in Abu Dhabi after getting approval from the FSRA.

A picture taken on January 24, 2022 shows Abu Dhabi, capital of the UAE which has come again under attack by Yemen's Huthi rebels
A picture taken on January 24, 2022, shows Abu Dhabi, the capital of the UAE which has come again under attack by Yemen's Huthi rebels AFP / Karim SAHIB
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