"Abu Dhabi International" Reviews new regulatory frameworks
ABU DHABI, December 11, 2017 – Abu Dhabi Global “ADGM”, and its Financial Services Regulatory Authority, reviewed a series of regulatory improvements that were recently approved, on the sidelines of the “FinTech Abu Dhabi” conference, which is being held within the activities of Abu Dhabi Financial Week 2024. The improvements include The new frameworks establish a comprehensive framework for the issuance of stable digital currencies backed by fiat currencies at ADGM to expand the portfolio of digital assets offered within a regulated environment, in addition to issuing detailed guidance on IT risk management and a paper. Consultation on the proposed amendments to the virtual assets framework, which will contribute to strengthening Abu Dhabi’s global position as a leading center for digital innovation and financial regulation. A dedicated regulatory framework for stable digital currencies backed by fiat currencies supports the issuance mechanisms for these currencies, expanding the range of digital assets offered within a safe and regulated environment.
This framework was developed after a series of extensive consultations across the sector, and includes key aspects such as strict reserve asset requirements, governance measures, transparent disclosures, thoughtful guarantees, and clear and defined redemption rights for holders of these currencies. This framework includes the issuance of stable digital currencies backed by fiat currencies as an activity subject to its own regulations, thus ensuring that issuers adhere to strong standards, in line with global best practices.
The Financial Services Regulatory Authority strengthens its regulatory approach through the IT Risk Management Directive, which provides insights and information on essential aspects for following a sound and thoughtful approach to risk management in this area. It also highlights the importance of the IT risk aspect in conducting business, and introduces regulatory measures such as: Comprehensive rules for unified reporting of incidents, and introduction of technical-regulatory solutions. A consultation paper proposing amendments to the regulatory framework of the Financial Services Regulatory Authority regarding virtual assets was also announced on the sidelines of Abu Dhabi Financial Week. The proposed amendments aim to improve the processes and mechanisms for accepting virtual assets at ADGM, continue improving capital requirements and fees, and deal with emerging business models.
The Financial Services Regulatory Authority seeks the views and feedback of stakeholders to ensure that the proposed regulatory framework is compatible with sector developments, while at the same time maintaining strong regulatory standards. The consultation paper also calls for opinions and comments on the criteria for accepting “stable digital currencies backed by fiat currencies” not issued by Abu Dhabi Global and proposes expanding investment opportunities for venture capital funds.
Emmanuel Jevanakis, CEO of the Financial Services Regulatory Authority at Abu Dhabi Global, said that Abu Dhabi Global’s growth journey as a leading international financial center revolves around its diverse and comprehensive initiatives in the regulatory field, and every new regulatory framework and amendment that is introduced is a reflection of Abu Dhabi Global and the Financial Services Regulatory Authority’s commitment to leadership.
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