The Registration Authority of Abu Dhabi’s ADGM has published guidance on cryptocurrency mining in the emirate's international financial centre.
The guidance, the first from a financial centre in the region, provides clear directions on commercial licencing to crypto miners and businesses conducting crypto mining within or from the emirate's financial centre, the authority said in a statement on Thursday.
The advice treats crypto mining as a “licencable commercial activity” overseen by the ADGM’s Registration Authority and not as a regulated financial service. The authority has adopted a “technology-neutral approach” across proof of work and proof of stake to ensure responsible mining activities, it said.
The move is in line with the ADGM’s broader strategy of promoting innovation, and enabling new business models to develop within a well-governed environment, said Rashed Al Blooshi, chief executive of the Registration Authority at the ADGM.
Abu Dhabi’s economy is increasingly being shaped by digital infrastructure, and the emirate regards crypto mining to be at the “intersection of energy, technology and capital”, Mr Al Blooshi said.
“With this guidance, ADGM is open for responsible crypto mining,” he said. “We are giving operators a clear commercial licencing pathway, proportionate supervision calibrated to scale and risk, and certainty on where the regulatory perimeter resides.”
The guidance builds on the ADGM’s goal to strengthen digital assets and emerging technologies within its jurisdiction, and provide greater regulatory certainty for “responsible crypto mining operators” seeking to increase their activities from Abu Dhabi, the authority said.
Businesses that meet governance and transparency standards of the ADGM will find in Abu Dhabi “a jurisdiction where they can plan, invest and grow with confidence”, Mr Al Blooshi added.
Abu Dhabi’s financial centre has been maturing its regulatory framework for digital assets as it strives to become a global base for cryptocurrency and digital assets companies and attract global operators.
Recent amendments streamline the process through which virtual assets are accepted for use in the financial centre. They also impose appropriate capital requirements and fees for authorised people conducting regulated virtual asset activities.
The Registration Authority said its guidance is the first phase of broader plans to develop crypto mining in the ADGM. In a second phase, it aims to develop regulations for mining, with market consultation set to begin in due course.
The issuance of the guidance follows an eight-week consultation published earlier in the year, which generated “substantive feedback”, it added.
