ADGM grants regulatory approval to virtual asset trading platform Hayvn

Company is authorised to arrange investment deals and provide custody for accepted virtual assets

The Abu Dhabi Global Market is looking to expand online asset trading options for investors. Alamy

The Abu Dhabi Global Market granted regulatory permission to virtual asset trading platform Hayvn as the financial free zone plans to expand online asset trading options for investors.

As a regulated over-the-counter (OTC) trading and custody platform, Hayvn is now authorised to arrange investment deals and provide custody for accepted virtual assets, the trading platform said on Thursday.

The company provides secure OTC trading and custody capabilities, enabling customers to trade virtual assets.

The regulatory approval will “further strengthen Hayvn’s positioning as an institutional virtual asset leader within the ADGM”, the company statement said.

“The ADGM regulatory approval adds further depth to our regulatory stack. We are a regulation-led firm, operating in a low-trust industry,” said Christopher Flinos, co-founder and chief executive at Hayvn.

“With virtual assets becoming more and more institutional, our regulatory framework provides the ideal platform to buy, sell and get custody of virtual assets.”

ADGM has three operational cryptocurrency exchanges and three more are at various stages of preparation for a soft launch, the financial hub’s Financial Services Regulatory Authority chief executive Emmanuel Givanakis said in November.

In 2018, the FSRA launched a comprehensive virtual asset framework for the trade of virtual assets by businesses, including multilateral trading facilities, custodians and brokers. These regulations have been continuously refined to mitigate risks and make the ADGM an attractive space for home-grown, regional and international companies.

Investor appetite for digital tokens and cryptocurrencies has been surging in the wake of the Covid-19 pandemic as homebound users look to invest their spare cash. At least half of institutional investors in the UAE surveyed by London-based Nickel Digital Asset Management this year said they plan to dramatically increase their exposure to cryptocurrency assets between now and 2023.

The volatile nature of cryptocurrency trading and the wild price swings in recent months have, however, drawn regulatory ire.

Central banks around the world are reluctant to endorse cryptocurrencies because of a lack of underlying value and regulatory oversight. The Central Bank of the UAE does not recognise cryptocurrencies as a legal tender.

China, the world’s second-largest economy, banned the mining and trading of Bitcoin and other digital currencies.

“Not only will this FSP allow us to attract institutional capital into virtual assets but also allow Hayvn to secure more funding opportunities and set us up with access to capital to scale our businesses even further,” Mr Flinos said.

Hayvn will begin accepting clients soon and subsequently go live with its operations in the ADGM after being granted FSRA clearance, according to the statement.

The most important factor in the virtual asset space is to build trust, said Rensche Olivier, director of regulation at Hayvn.

“We operate in an industry that lacks trust and regulation. Being a regulated firm within the ADGM helps build the level of trust that is needed to establish confidence within the new-to-cryptocurrency market,” Ms Olivier said.