Abu Dhabi has proposed a regulatory framework for fiat-backed tokens and is seeking public feedback

ChainCatcher news, according to Cointelegraph, the Abu Dhabi financial regulator plans to regulate fiat-referenced tokens (FRT), and the regulator has invited the public to provide feedback on the proposed regulatory framework. The Financial Services Regulatory Authority (FSRA) stated that the proposal defines FRT as a digital asset whose transfer and storage are electronically achieved through the use of distributed ledger technology.

The Abu Dhabi Global Market Financial Services Regulatory Authority (FSRA) indicated that FRT issuers will be subject to operational restrictions and requirements. The FSRA proposed that the market value of reserve assets should be at least equal to the face value of all circulating FRT at the end of each business day. FRT should also be valued at the daily market price. The regulator further suggested that institutions issuing two or more FRTs should operate and maintain independent reserve asset pools for each FRT and manage each reserve asset pool separately.

The FSRA has set October 3, 2024, as the deadline for submitting comments on the proposal. After receiving feedback, the FSRA will consider whether modifications to the proposed regulatory framework for FRT are necessary.