ADGM: FSRA issues discussion paper on DeFi to engage stakeholders
The Abu Dhabi Global Market ('ADGM') announced, on 13 April 2022, that the Financial Services Regulatory Authority of the ADGM had issued a discussion paper on Decentralised Finance ('DeFi'), with the aim of engaging industry practitioners and other stakeholders to explore potential opportunities arising from DeFi, associated risks, and what a future regulatory framework might look like. In particular, the ADGM noted that while DeFi has the potential to improve efficiency of financial services, it remains a largely unregulated area. Furthermore, the ADGM specified that the paper sets out the FSRA's views on the medium-term direction of DeFi, high level policy positions that the FSRA considers adopting, and an exploration of what a DeFi regulatory framework might look like.
Notably, the ADGM highlighted that as part of an ongoing commitment to engage a wide range of stakeholders, the paper will be mapped as a knowledge graph within the FSRA’s digital regulations beta pilot, allowing market participants to visualise and better grasp the concepts that link DeFi to traditional financial services, as well as their implications for regulatory guidance.