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The Financial Services Regulatory Authority, Abu Dhabi Global Market’s financial regulator has unveiled six principles to guide its “approach towards virtual asset regulation and oversight.”
Abu Dhabi Global Market (ADGM), which is a global financial center and free zone located in the United Arab Emirates, recently revealed six principles to govern virtual asset supervision and regulation. These principles were released by Abu Dhabi Global Market’s financial regulator, the Financial Services Regulatory Authority. They are meant to “support engagement with other similar regulatory agencies in the UAE.”
Although not legally binding, these principles must be “viewed in conjunction with the detailed detail of our published framework,” according to the FSRA. The six principles could serve as the basis for “regulation cohesion across jurisdictions.”
The principles not only “provide an accessible view” about the priorities of the FSRA in this area, but also reflect the regulator’s risk appetite for regulation.
“Each principle is a declaration of the FSRA’s risk appetite in the areas of regulation,authorisation, financial crime, supervision, enforcement and international cooperation. These expectations, when viewed in a holistic manner, are calibrated to ensure the right balance between confidence and risk sensitivity, customer protection, and attracting new entrants.” The regulator explained.
High standard will be set for digital asset regulations
The document outlines the key attributes for each approach to regulating virtual asset regulation. The FSRA’s principle no. 1 calls for “a robust, transparent, risk-based regulatory framework that defines VAs (virtual resources) as commodities in the larger digital asset universe.” It also requires licensing entities involved in regulated activities using VAs within ADGM.
However, licensed virtual asset entities should have the “same regulatory status” within ADGM as other licensed entities.
The second principle requires that high standards be maintained when authorizing virtual assets. The FSRA states that virtual assets should be regulated in a way that prevents financial crimes and money laundering. The regulators should also be committed to using enforcement tools when licensed entities are in violation of regulations.
The post Abu Dhabi Market Regulators Have Revealed Digital Asset Regulation Guides first appeared on The Daily Encrypt.
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