Abu Dhabi’s ADGM introduces crypto mining licence under new regulatory guidance

The Registration Authority of Abu Dhabi’s ADGM has issued guidance on cryptocurrency mining in the emirate’s international financial centre. This marks the first time a financial centre in the region has provided clear directions for commercial licensing to crypto miners and businesses engaged in mining within or from the emirate’s financial centre, according to a statement from the authority on Thursday.

The guidance frames crypto mining as a "licencable commercial activity" overseen by the ADGM’s Registration Authority and not as a regulated financial service. The authority has taken a "technology-neutral approach" to mining, accommodating both proof of work and proof of stake methodologies, to ensure responsible mining activities.

ADGM's chief executive, Rashed Al Blooshi, emphasized that the move aligns with the ADGM's strategy of promoting innovation and enabling new business models within a well-governed environment. Abu Dhabi's economy is increasingly shaped by digital infrastructure, and the emirate views crypto mining as being at the "intersection of energy, technology and capital".

The guidance provides operators with a clear commercial licensing pathway, proportionate supervision calibrated to scale and risk, and certainty regarding the regulatory perimeter, according to Al Blooshi. The guidance builds upon the ADGM's objective to bolster digital assets and emerging technologies within its jurisdiction, offering greater regulatory certainty for responsible crypto mining operators seeking to expand their activities from Abu Dhabi.

Businesses that align with the ADGM’s governance and transparency standards will find Abu Dhabi to be a jurisdiction where they can plan, invest, and grow with confidence, added Al Blooshi. Abu Dhabi’s financial centre has been refining its regulatory framework for digital assets as it aims to become a global hub for cryptocurrency and digital assets companies, attracting global operators.

Recent amendments have streamlined the process for accepting virtual assets for use within the financial centre, imposing appropriate capital requirements and fees for authorized individuals conducting regulated virtual asset activities. The issuance of the guidance represents the first phase of a broader plan to develop crypto mining in the ADGM, with regulations for mining set to be developed in a subsequent phase following market consultation.