The United Arab Emirates is bringing more structure to its digital economy with the Capital Market Authority (CMA) announcing a comprehensive new framework for virtual assets. The move aims to provide clear regulatory oversight for the fast-growing sector, establishing rules of the road for companies operating in the space while protecting investors.
Quick Facts
- New framework provides a specialized regulatory umbrella.
- Regulated virtual asset activities expanded from three to eight.
- Rules align with global standards from IOSCO and FATF.
A Wider Regulatory Net
The new framework significantly broadens the scope of regulated activities. The CMA has expanded its oversight from just three business types to eight, reflecting the increasing complexity of the virtual assets market.
The newly covered activities include: Dealing in Virtual Assets as Principal or Agent, Providing Custody, Arranging Custody, Arranging Investment Deals, Providing Investment Advice, Portfolio Management, and Operating a Multilateral Trading Facility. This expansion signals a more mature regulatory approach, designed to cover a wider range of business models emerging in the digital asset industry.
Bridging TradFi and Digital Assets
A core component of the new rules is a dedicated module for Alternative Trading Systems (ATS). This section doesn’t just govern crypto-native exchanges; it also extends to conventional trading facilities for securities and platforms that handle tokenized securities.
This integrated approach shows the CMA is preparing for a future where traditional and digital financial markets converge. By creating a coherent framework for all types of trading environments, the regulator is building a foundation that can adapt as market structures evolve.
Balancing Innovation with Market Integrity
According to the CMA, the framework is built on the principle of “same activity, same risk, same regulatory outcome.” The goal is to create a balanced environment that supports responsible innovation without compromising market integrity or investor safety. This involves clear requirements for licensing, compliance, governance, and risk management.
“Virtual assets are reshaping how financial markets operate, and regulation must evolve at the same pace,” said Waleed Saeed Al Awadhi, Chief Executive Officer of CMA. “This framework establishes clear and comprehensive foundations for virtual asset activities in the UAE, enabling innovation to develop within a trusted environment that safeguards investors and upholds market integrity.”
About the Capital Market Authority
The Capital Market Authority (CMA) is the regulatory body responsible for supervising and developing the financial and capital markets in the United Arab Emirates. The authority works to create a stable, transparent, and competitive financial environment that aligns with international standards and supports economic growth.
Source: Zawya
