Cryptocurrency exchange platform Rain has been granted a financial services permission (FSP) by Abu Dhabi Global Market, paving the way to offer more products and services to clients in the UAE and the region.
The FSP enables Rain to list a greater number of virtual asset pairs, having met the Accepted Virtual Assets criteria set out by ADGM's Financial Services Regulatory Authority (FSRA), the company told The National on Tuesday.
Rain ADGM will now be able to offer the ability to buy, sell and store virtual assets, as well as having a seamless fiat-to-virtual asset on-ramp service in UAE dirhams to institutional and a number of retail clients in the country, it said.
A cryptocurrency on-ramp refers to a service in which fiat money, or those that are legal tender, can be offered in return for cryptocurrency.
“This achievement represents a significant milestone not just for Rain, but for the entire virtual assets industry,” Joseph Dallago, chief executive of Rain, said in the statement.
“With this licence, we can now offer our customers an even greater level of security and trust, as we continue to drive innovation and growth in the virtual assets space. Furthermore, Rain now offers the only regulated on-ramp and off-ramp of UAE dirhams into virtual assets in the UAE.”
The cryptocurrency industry has struggled with continued price declines since last year, but has since recovered lost ground.
Proponents of the technology claim that virtual assets are the future of money and that it is a safer and more practical way to conduct transactions as it is powered by blockchain.
Abu Dhabi has taken several steps to integrate blockchain into the economy, government and society as part of efforts to develop the economy.
The UAE capital in November last year launched the Middle East, Africa and Asia Crypto and Blockchain Association, a non-profit organisation backed by ADGM to hasten the development of blockchain and cryptocurrencies in the region.
Rain Financial is one of its partners, along with other major cryptocurrency platforms such as Mubadala-backed MidChains, Dubai-based BitOasis, Crypto.com and Binance, the world's biggest cryptocurrency exchange by trading volume.
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Rain's FSP affirms “ADGM's role as an international financial centre and facilitator for business growth”, said Arvind Ramamurthy, chief of market development at ADGM.
“ADGM’s mission has always been centred around unlocking new opportunities for growth and investment in the virtual assets sector. This has been made possible through the implementation of a robust and progressive regulatory framework for digital assets,” he said.
ADGM said it introduced the world’s first comprehensive virtual assets framework in 2018. It has established its International Financial Centre as an attractive business hub and platform for virtual assets and digital assets activities for home-grown, regional and international companies.
“We are continuously trying to add value to Abu Dhabi’s digital asset ecosystem while also supporting the diversification of our flourishing economy,” Mr Ramamurthy said.
Rain first received its in-principle approval for an FSP in January 2022. A week before that, its operator, Bahrain-based Rain Financial, raised $110 million in a series B funding round as digital currencies gained more acceptance among mainstream investors globally.
Rain Financial became the first licensed virtual assets service provider in the Middle East in 2019 and is regulated by Bahrain's central bank. The company offers its customers a way to buy and sell digital currencies, as well as custodian services to hold their assets.
Rain was founded in 2017 by Mr Dallago, Abdullah Almoaiqel, AJ Nelson and Yehia Badawy, and has continued to boost its technology and services through an advanced trading platform, as well as growing its team.
