ADGM rolls out updated digital asset rules: ADGM’s Financial Services Regulatory Authority (FSRA) enacted a series of amendments to its digital assets framework, it said in a statement. The changes, outlined here (pdf) and here (pdf), apply to all firms conducting regulated activities involving virtual assets (VAs) in ADGM.

The changes: The revised framework introduces stricter criteria for recognizing Accepted VAs (AVAs) and codifies FSRA’s approach to determining which tokens may be used in regulated activities. It also sets new capital requirements and updated licensing conditions for VA firms. The amendments follow industry feedback on a consultation paper issued in December 2024.

Where FSRA can say no: A new product intervention tool gives FSRA discretion to restrict or prohibit the issuance, trading, or custody of specific VAs or fiat-referenced tokens that pose systemic or investor protection risks. The regulator has also formalized a ban on privacy tokens and algorithmic stablecoins, barring their use across all regulated activities in the ADGM.

FSRA also now has “own-initiative powers” to impose or waive specific compliance requirements on individual firms, and can issue binding directions without prior consultation if a VA or fiat-referenced token poses a risk to the market. Operators of Multilateral Trading Facilities (MTFs) that list AVAs must obtain a separate Recognition Order as Recognised Investment Exchanges under the new rules.

Fees revised: VA firms must now pay application fees ranging from USD 20k-125k, depending on whether they operate an MTF, with annual supervision fees of USD 15k-60k.

Venture capital access widened: The amendments expand the range of digital assets in which ADGM-based venture capital funds may invest, provided those assets meet the updated AVA standards.

ICYMI- Dubai also updated its crypto rulebook: Last month, Dubai’s Virtual Assets Regulatory Authority (Vara) issued the second edition of its regulatory framework, tightening controls on margin trading, token issuance, and custody services. The revised rules also standardize compliance across all licensed activities and bar non-Vara licensed firms from distributing stablecoins or asset-referenced tokens. VA service providers have until 19 June to comply.

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