ADGM's Registration Authority issues guidance on crypto mining in Abu Dhabi

The Registration Authority of Abu Dhabi’s ADGM has released guidance on cryptocurrency mining in the emirate's international financial hub. This marks the first such guidance from a financial center in the region, according to a statement from the authority on Thursday. The guidance outlines clear rules for commercial licensing of crypto miners and businesses engaging in crypto mining within or from the emirate's financial center.

The advice treats crypto mining as a "licencable commercial activity" overseen by the ADGM’s Registration Authority, rather than a regulated financial service. The authority has taken a "technology-neutral approach" to ensure responsible mining, covering both proof of work and proof of stake operations. This strategy aligns with ADGM's broader goal of fostering innovation and enabling new business models within a well-governed environment, stated Rashed Al Blooshi, chief executive of the Registration Authority at ADGM.

Abu Dhabi's economy is increasingly influenced by digital infrastructure, and crypto mining is seen as an intersection of energy, technology, and capital, according to Al Blooshi. The guidance is intended to provide a clear commercial licensing pathway, proportionate supervision related to scale and risk, and certainty on regulatory boundaries for responsible crypto mining operators.

The ADGM is enhancing digital assets and emerging technologies within its jurisdiction, offering a regulatory environment for "responsible crypto mining operators" to grow their activities, said Al Blooshi. The guidance builds upon the ADGM's aim to strengthen digital asset and emerging technology sectors and provide regulatory certainty for operators seeking to expand their crypto mining operations from Abu Dhabi.

For businesses meeting governance and transparency standards set by the ADGM, Abu Dhabi presents a jurisdiction where they can plan, invest, and grow with confidence, added Al Blooshi. Abu Dhabi's financial center is refining its regulatory framework for digital assets as it seeks to become a global base for cryptocurrency and digital asset companies and attract global operators.

Recent amendments have streamlined the process for accepting virtual assets for use in the financial center, imposing appropriate capital requirements and fees for authorized personnel conducting regulated virtual asset activities. The Registration Authority noted that its guidance represents the first phase of broader plans to develop crypto mining in the ADGM, with regulations for mining to be developed in a second phase following market consultation.