Abu Dhabi becomes the global market for Asset and Cryptocurrency exchange
Currency is much more than just coins and papers; which people use as a medium to exchange services and goods. Since the beginning of human evolution, the currency has been the form of trade which exists even today. Over time, currency also went through an evolution, and it took several forms. Nevertheless, the outcome or the end value of the currency is still the same; people use for trade and commerce.
Previously the transactions were revolving around exchange in the physical form of currency. People were utilizing the legal tender during the Victorian Era. Currently, several advancements came into being in the technology sphere. However, the present and most controversial form of the alternative of currency or fiat currency is garnering much attention. Satoshi Nakamoto did change the world by curating the genesis block of Bitcoin, and now there are more than 400 cryptocurrencies in the world.
Cryptocurrency facilitates the conventional financial system, the same way the fiat currency work. However, cryptocurrency is better from the perspective of the users as it is incredibly tangible and has a digital value.
Why are countries adopting cryptocurrency as fiat currency’s alternative?
The fiat currency of distinctive nations relies on the central banks of their respective countries. Moreover, the authorities are in charge of controlling the cryptocurrency to facilitate regulation. In addition to this, the standard currency is not anonymous, and neither do the users take total control over them. Contrastingly, cryptocurrency enlists decentralization, meaning nobody is in control of the cryptocurrency, especially central banks.
Cryptocurrency is more like a cutting-edge technology for transactions where the transactions are carried out by DLT. Furthermore, DLT or Distributed Ledger Technology spreads across several devices across a network where data synchronizes significantly without third-party’s involvement. On the other hand, cryptocurrency also uses the consensus such as PoW or PoS to carry out the transactions.
For quite some time, cryptocurrency has become a mainstream medium of transaction among several countries. Most of the countries that do not have a stable economy are utilizing cryptocurrency to support its economy. The best part is the plan is working, and the economy is becoming stable in due course of time.
One of the countries that have been openly speaking about using cryptocurrency is UAE. In the last couple of years, UAE is actively taking part to integrate cryptocurrency into its economy via the ADGM. Moreover, the Abu Dhabi Global Market is the international financial free zone and financial center across Abu Dhabi.
What is Abu Dhabi’s guidelines on cryptocurrency?
The guideline suggests that the cryptocurrency asset is the digital representation of the medium of exchange. Moreover, the people residing across Abu Dhabi can easily commence trade using cryptocurrency. However, the main objectives were to address the impending risks which arises while trading the cryptocurrency assets. The two definitive guidelines which FSRA in Abu Dhabi brought forward are:
1- Cryptocurrency Assets Regulations and the Digital Security Offerings come directly under the governing body, FSMR. (Implemented from 13th of May 2019)
2- Regulation of the Cryptocurrency Asset Activities of ADGM. This regulation is active since the 14th of May 2019.
The regulatory framework suggests that people have to take permission from a market operator, custodian, and intermediary. Then after the FSRA permits the person to conduct cryptocurrency exchange, they can.