How the UAE's ADGM is fighting crypto crime

From detailed guidance to hosting key events, the financial district strives to be one step ahead to protect investors

The Abu Dhabi Global Market headquarters is seen on Al Maryah Island. Victor Besa / The National

The Abu Dhabi Global Market is one of the world's fastest-growing financial districts, and its reputation as a step-ahead regulator is reflected in its strategy when it comes to digital assets.

On Friday, its Financial Services Regulatory Authority signed a preliminary agreement with the UAE Ministry of Interior to boost its fight against crimes in this sector.

The points of collaboration include information exchange, boosting risk mitigation frameworks and supporting the UAE's national strategy to protect the financial system against evolving threats in the digital asset landscape, in addition to joint training programmes and enhanced investigative efforts. it said.

“The FSRA is focused on collaboration with UAE authorities to proactively fight against financial crime. Financial crime is constantly evolving and it is crucial that regulators stay ahead of potential threats," Emmanuel Givanakis, chief executive of the FSRA, said in a statement.

That is also the latest in a long list of programmes designed by ADGM to encourage and protect investors in the growing space, helping the FSRA to become one of the first jurisdictions worldwide to implement a comprehensive and robust regulatory framework for crypto and digital asset activities since 2018.

Detailed guidance

Part of ADGM's mission is to support the development of digital assets under a comprehensive and progressive regulatory framework, "as part of its holistic approach".

In its multipronged guiding principles governing its approach to virtual asset supervision, the FSRA has made it clear that only the "high[est] level" of regulations and co-operation are to be implemented to ensure the credibility of the sector.

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  The two-day Bitcoin Mena event at Adnec in Abu Dhabi explores the transformative potential of cryptocurrencies. All photos: Pawan Singh / The National

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  Shaping the Future: Strategic Leadership & Bitcoin Adoption in the Middle East session at Bitcoin Mena at Adnec in Abu Dhabi on December 10. Panelists from left to right are Aymman Shaikh, BTC; Dr Ayesha Binlootah, Virtual Assets Regulatory Authority; Bilal Ahmed Mir, Carter Capital and Khurram Shroff, 3iQ.

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  Sheikh Nahyan bin Mubarak, Minister of Tolerance and Coexistence, attends Bitcoin Mena

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  Delegates at Bitcoin Mena held at Adnec in Abu Dhabi

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  Khurram Shroff, adviser at 3iQ, addresses the Shaping the Future session

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  Vishal Sacheendran of Binance addresses the question of how nations are shaping Bitcoin’s regulatory landscape

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  Dr Ayesha Binlootah of the Virtual Assets Regulatory Authority talks to the audience at the Shaping the Future session

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  Visitors at the Binance stand at Bitcoin Mena

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  Aymman Shaikh of BTC during the Shaping the Future session at Bitcoin Mena

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  Harris Irfan of CCM and Onramp Mena shares his thoughts on Islamic fiat banking at Bitcoin Mena on December 10

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  Visitors at Bitcoin Mena at Adnec in Abu Dhabi

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  Saifedean Ammous from Saifedean.com addresses the session on Bitcoin: A New Frontier for Islamic Finance at Bitcoin Mena

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  AJ Nelson, co-founder of Rain, discusses regulation at Bitcoin Mena held at Adnec in Abu Dhabi

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  Sudhu Arumugam of M2 also spoke on regulation at Bitcoin Mena

These principles include a robust and transparent risk-based regulatory framework, high standards for authorisation, preventing money laundering and other financial crime, risk-sensitive supervision, commitment to enforce on regulatory breaches and international co-operation. These have been the basis of Abu Dhabi's numerous initiatives rolled out to encourage the use of digital assets.

These, in turn, are helping address the "full range" of risks associated with digital asset activities, including risks relating to money laundering and financial crime, consumer protection, technology governance, custody and exchange operations, according to the FSRA.

Tailored events

Abu Dhabi Finance Week, which held its third edition at ADGM earlier this month, has become a fixture in the capital's financial scene, attracting the world's biggest industry players and thought leaders.

The summit is one of the ways ADGM is able to tap experts to provide insights on the state of digital assets and where they are headed.

The capital also hosted the inaugural Abu Dhabi Business Week and Bitcoin Mena earlier in December, where cryptocurrencies and other digital assets were front and centre.

In addition, ADGM also helped launch the Middle East, Africa and Asia Crypto and Blockchain Association, a non-profit organisation comprising industry majors such as Binance and Crypto.com to help draw up strategies addressing the industry's challenges.

Operational licence grants

Several global cryptocurrency players have sought to establish a foothold in the UAE and ADGM's efforts have been able to attract some of the biggest names, such as eToro and M2, allowing these companies to operate as a brokers for securities, derivatives and crypto assets, and platforms institutional and retail investors to buy, sell and hold custody of virtual assets.

This further raises the profile of ADGM as a safe hub to conduct crypto activity. Of course, companies who wish to operate in Abu Dhabi have to go through a rigorous application process to ensure the viability and security of their offerings.

The rising stock of virtual assets has prompted governments to figure out rules to rein in the largely unregulated industry. ADGM has continuously sought to address this in order for Abu Dhabi to become an attractive destination.

Never-ending improvement

ADGM continuously seeks to improve its already-robust digital asset strategies, keeping in step or even ahead of its peers globally. ADGM has rolled out a slew of updated guidelines to improve those already in place in order to further boost confidence in the sector.

Earlier this month, the FSRA introduced a regulatory framework for the issuance of fiat-referenced tokens – a category of stablecoins backed by high-quality and liquid assets denominated in the same currency – which expands the suite of digital assets that can be offered in a regulated environment.

The FSRA said this is aimed to ensure financial stability and investor protection in facets such as reserve assets, governance and integrity, and transparent disclosure, among others.

Gathering opinion

Public consultation is key in drawing up frameworks for regulation. For instance, earlier this month, ADGM announced the publication of a new consultation paper that sets out proposed amendments to its regulatory framework for authorised persons conducting regulated activities involving virtual assets.

In addition, ADGM is also seeking feedback on the criteria to be applied in determining whether non-ADGM issued fiat-referenced tokens should be accepted within ADGM. The paper also proposes to expand the scope of investments in which venture capital funds may invest. The consultation period for this paper will close on January 31.

Penalties for offenders

No sector is perfect, and there are instances in which financial services providers would run afoul of the law. ADGM takes this very seriously.

While no company directly engaged in digital assets has been fined for violations, ADGM has meted out penalties to financial companies such as Pyppl, Sarwa Digital Wealth and Aarna Capital for various breaches.

This serves as a deterrent for companies to ensure they uphold the highest standards and promote transparency in their operations, especially for those in digital assets, whose regulations are still evolving and trust needs to be strengthened.

Crime-fighting

Friday's announcement comes as virtual assets – known to be high-risk assets – have become an emerging favourite target for hackers: the value of cryptocurrencies stolen in 2024 hit about $2.2 billion, a 21 per cent leap from last year, as attacks hit a record 302, Chainalysis said in its 2025 Crypto Crime Report on Thursday.

Any threat to digital assets will cause severe reputational and financial consequences, which is why ADGM has pledged to "protect the financial ecosystem and lead regulatory efforts in line with international best practices and federal laws", Mr Givanakis said on Friday.

"Our goal is to build long lasting partnerships across the UAE to ensure prevention of financial crime … including the use of virtual assets. We also seek to raise awareness internally and locally to ensure proper understanding of financial crime risks and assist actively in the efforts conducted on a national level."