Overview

The Financial Services Regulatory Authority (FSRA) is the independent financial regulator of the Abu Dhabi Global Market (ADGM), the international financial centre on Al Maryah Island. The FSRA was the first regulator in the region - and among the first globally - to introduce a comprehensive, bespoke regulatory framework for digital assets, and remains one of the most sophisticated virtual asset jurisdictions in the world. In June 2025, following extensive industry consultation, the FSRA implemented a significant package of amendments to its digital asset framework - streamlining the Accepted Virtual Asset process, refining capital requirements and fees, introducing a dedicated product intervention power, and formally enshrining the prohibition on privacy tokens and algorithmic stablecoins in its rulebooks.

Unlike VARA and the CMA, which operate activity-based licensing regimes, the FSRA regulates digital assets through its broader Financial Services Permission (FSP) framework under the Financial Services and Markets Regulations 2015 (FSMR). Entities wishing to carry on regulated activities involving virtual assets in or from ADGM must obtain FSRA approval as part of their FSP. The framework is principles-based, risk-calibrated, and designed to accommodate institutional-grade business models across the full spectrum of digital asset classes.

Scope

The FSRA's digital asset framework covers four distinct categories of asset, each attracting a different regulatory treatment:

Virtual Assets - Non-fiat digital assets such as Bitcoin and Ether, treated as commodities rather than specified investments under FSMR. Entities carrying on regulated activities involving virtual assets must obtain FSRA approval and may only use Accepted Virtual Assets. Following the June 2025 amendments, the assessment process has been streamlined - authorised persons now conduct their own assessment against the FSRA's criteria and notify the regulator at least five business days before use, rather than seeking individual FSRA-led approval for each asset. Ongoing monitoring of all accepted virtual assets remains mandatory.

Fiat-Referenced Tokens (FRTs) - Stablecoins backed by a single fiat currency and redeemable at par on demand. Issuing an FRT is a distinct regulated activity in ADGM. Authorised persons carrying on any regulated activity involving an FRT may only use Accepted FRTs - those approved and listed by the FSRA. The current Accepted FRT list includes USDC, USDT, USDP, USDG, RLUSD and others across multiple networks.

Digital Securities - Digital tokens exhibiting the characteristics of a security under FSMR are deemed securities and regulated accordingly. All financial services activities in relation to digital securities - including operating primary and secondary markets, dealing, managing investments and advising - are subject to full FSMR requirements.

Derivatives and Funds - Derivatives over digital assets, and collective investment funds investing in digital assets, are regulated as derivatives and units in a fund respectively under FSMR. Market operators and intermediaries dealing in such instruments are required to hold the relevant FSP or recognition order from the FSRA.

Privacy tokens and algorithmic stablecoins are categorically prohibited from use in any regulated activity in ADGM.

Licence Categories

Authorised persons in ADGM are granted an FSP for one or more of the following virtual asset regulated activities:

• Dealing in Investments as Principal - Buying and selling virtual assets as principal on behalf of clients or on a proprietary basis.
• Dealing in Investments as Agent - Buying and selling virtual assets on behalf of clients as agent.
• Advising on Investments or Credit - Providing advice on the acquisition, disposal or management of virtual assets.
• Arranging Deals in Investments - Making arrangements that enable clients to deal in virtual assets, including order transmission and coordination roles.
• Managing Assets - Discretionary portfolio management of virtual assets on behalf of clients.
• Providing Custody - Safekeeping of client virtual assets, including management of private keys and wallet infrastructure, subject to detailed custodial requirements under COBS Chapters 15, 16 and 17.
• Operating a Multilateral Trading Facility - Running an MTF for the spot trading of virtual assets, subject to market surveillance, settlement, transaction monitoring, transparency and exchange-equivalent operational standards. The FSRA was the first regulator globally to regulate virtual asset MTFs.

In addition, Issuing a Fiat-Referenced Token is a distinct regulated activity requiring FSRA approval, separate from the virtual asset regulated activities above.

Entities seeking to operate across both virtual asset and traditional financial instrument activities may combine regulated activities within a single FSP, subject to FSRA approval for each activity type.

Applicant Profiles

The FSRA accepts applications from a broad range of entities - including global exchanges, custodians, broker-dealers, asset managers, FRT issuers and tokenisation platforms - provided they can demonstrate adequate ADGM substance, fit-and-proper management, sufficient capitalisation and robust systems and controls. Applicants must establish a presence within ADGM; the FSP does not confer authorisation to operate outside the ADGM jurisdiction. 

Process

The FSRA authorisation process follows a structured six-stage pathway:

• Initial engagement - Applicants contact the FSRA Authorisation Team for a preliminary discussion. Applicants should come prepared with a regulatory plan covering proposed regulated activities, internal controls and risk management arrangements. MTF applicants should contact the FSRA's Markets and Infrastructure Policy team separately.
• Application submission - The completed FSP application form and all required supporting documentation are submitted alongside the applicable application fee.
• Assessment and interviews - The Authorisation Team reviews the submission, follows up on clarifications and conducts interviews with proposed approved persons and key appointment holders.
• In-principle approval - If the application meets the FSRA's requirements, the applicant receives an in-principle approval, subject to conditions. This does not constitute a licence.
• Satisfaction of conditions - The applicant satisfies all conditions attached to the in-principle approval, including capitalisation, hiring of key personnel and registration with the ADGM Registration Authority for a commercial licence.
• FSP issuance - Once all conditions are met, the FSRA issues the Financial Services Permission and the applicant becomes an Authorised Person in ADGM.

Key Considerations

• Capital - Requirements are calibrated to activity type and risk profile, and were refined as part of the June 2025 amendments. Minimum capital thresholds apply to each regulated activity and the FSRA retains discretion to impose higher requirements based on the scale and complexity of the proposed business.
• Accepted Virtual Assets - Authorised persons may only use virtual assets that have been assessed against the FSRA's criteria. Following the June 2025 amendments, this is now a firm-led process - authorised persons conduct their own assessment and notify the FSRA at least five business days before use. Assessments must cover traceability and monitoring capability, security, market profile, exchange connectivity, DLT infrastructure, innovation and practical functionality. Ongoing monitoring is required throughout.
• Accepted FRTs - Any regulated activity involving a fiat-referenced token must use only FSRA-accepted FRTs. The accepted list is maintained and updated by the FSRA and currently includes major stablecoins across multiple blockchain networks.
• Product intervention - The June 2025 amendments introduced a specific product intervention power in relation to virtual assets, enabling the FSRA to require an authorised person to take specified action - or cease conducting a regulated activity in respect of a particular virtual asset - for such period as the FSRA considers appropriate. This power sits alongside the FSRA's existing broad supervisory and enforcement toolkit under FSMR.
• Staking - The FSRA has finalised its regulatory framework for the staking of virtual assets, providing authorised persons with regulatory clarity on the conditions under which staking services may be offered to clients within ADGM. Firms wishing to offer staking should engage with their FSRA supervision team on the applicable requirements before launch.
• Governance and substance - Fit-and-proper assessments apply to senior management, approved persons and key appointment holders. Adequate ADGM substance is required, and the FSRA assesses the operational, financial and regulatory track record of the entity and its shareholders as part of the authorisation process.
• Technology governance - Comprehensive systems and controls are mandatory, covering virtual asset wallets, private key management, origin and destination of funds, security procedures, and risk management and systems recovery. Specific additional requirements apply to MTF operators and custodians.
• AML/CFT - The FSRA's AML Rulebook applies in full to all authorised persons. Authorised persons must also address their international tax reporting obligations under FATCA and the Common Reporting Standard.
• Custody - Virtual asset custodians are subject to detailed requirements under COBS Chapters 15, 16 and 17, including frequent reconciliations, reporting and appropriate internal controls for the safeguarding of client assets.
• Prohibited instruments - Privacy tokens and algorithmic stablecoins may not be used in any regulated activity in ADGM under any circumstances. This prohibition is now formally enshrined in the FSRA's rulebooks following the June 2025 amendments.

Engage CFC

The FSRA's framework is one of the most technically sophisticated virtual asset regimes globally - combining institutional-grade regulatory standards with a principles-based approach that rewards well-prepared applicants. CFC's regulatory specialists support exchanges, custodians, asset managers and FRT issuers through every stage of the ADGM authorisation process - from initial regulatory planning and accepted virtual asset assessments through to FSP applications, governance frameworks and ongoing supervisory compliance. Speak with a former regulator about what an FSRA-ready application looks like for your business.