Is NFT really mainstream? Abu Dhabi Global Market could soon allow license operators to trade legally NFTs.

An assessment paper captioned “proposals for enhancements to capital markets and virtual assets in ADGM” was published by Abu Dhabi Global Market (ADGM) on Monday. This paper included draft standards for the trading NFTs, and other asset types.

It proposed that all businesses operating under the license of the emirate’s totally free zone monetary regulator should be permitted to offer NFT trading services. The file contained an entire page dedicated to NFTs, virtual property and other areas that are not related to standard monetary tools.

In this section, the Financial Services Regulatory Authority (FSRA), which serves as the free zone’s chief regulatory body, described NFTs as intellectual property rather than “specified investments or financial instruments.”

Section also proposes permission for Multilateral Trading Facilities (MTFs), and Virtual Asset Custodians to operate NFT Marketplaces.

Although the document emphasized that the FSRA was not proposing a formal regulatory framework for digital collectibles, it did not fail to raised concerns over compliance with ADGM’s Anti-Money Laundering (AML) and Sanctions Rules.

As the consultation paper was still available for comments until May 20, stakeholders were invited to voice their opinion on various issues. One of the issues is the question of “What types of NFTs should be permitted to trade upon MTFs?” and “How would it be best to integrate third-party NFT registries?”

ADGM is the only one among the three United Arab Emirates major economic zones to host virtual asset services providers (VASPs). It was granted its regulatory framework in 2018. However, it was the Dubai Multi Commodities Centre (DMCC), another of UAE’s free zone that grabbed the spotlight last week by granting its newly legislated crypto license to FTX and Binance exchanges.

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