- Abu Dhabi has released a regulatory framework to govern entities venturing into web3
- The framework is part of the city’s move to legally recognize the sector
- The move follows other recent efforts by cities in the UAE to support the crypto and blockchain market
Abu Dhabi is moving a step closer to legally recognizing the web3 world by enacting a framework meant to govern entities in the sector. The move follows recent efforts by cities in the United Arab Emirates (UAE) to support the crypto and blockchain world, something that has seen crypto platforms like Binance moving to the region. Abu Dhabi’s regulator considers the move “as a driving force for positive change in the digital assets sector,” a sign that countries have started seeing the benefits of crypto and/or the technology that underpins it.
DAOs Finally Out of Legal Shadows
According to the Registration Authority of Abu Dhabi Global Market (ADGM), the legislative structure targets to provide a conducive environment for the smooth operation of web entities such as DAOs, which have remained in the legal shadows for a long time.
Dubbed the ‘Distributed Ledger Technology (DLT) Foundations Regulations 2023,’ it also encompasses conventional firms looking to enhance their operations using blockchain technology. Abu Dhabi is also using the framework to advance its position to be a “global pioneer in the regulations of digital assets.”
ADGM’s chairman Ahmed Jasim Al Zaabi said that most blockchain-focused entities are moving to the UAE capital, necessitating the city to adopt “a proactive approach [in] setting global benchmarks with enhanced transparency and efficiency.”
Dubai Fronts Crypto Law
The framework comes six months after Bitcoin mining company Marathon Digital disclosed that it’s building immersion-cooled mining sites in the UAE. It also comes roughly two years after Dubai announced a virtual asset law that sought to boost crypto/blockchain usage in Dubai.
With the introduction of a legal framework recognizing web3 activities, Abu Dhabi, and the UAE at large, is bound to become the preferred destination for crypto and blockchain companies.