Animoca Brands Receives Preliminary Approval in Abu Dhabi
Animoca Brands, a Hong Kong-based leader in Web3 investment, has announced it has received preliminary approval from the Financial Services Regulatory Authority (FSRA) in Abu Dhabi. This move marks a significant step toward establishing itself as a regulated fund manager within one of the Middle East’s key hubs for digital assets. Once specific criteria are met and final approval is obtained, Animoca will be permitted to manage a collective investment fund in or from the Abu Dhabi Global Market (ADGM).
Strategic Positioning in Digital Assets
The company has carved out a niche in the intersection of gaming, non-fungible tokens (NFTs), and digital currencies, and this latest development signifies its intent to delve deeper into institutional finance. According to Animoca Brands, it operates not just as a digital asset advisory but also as an investment management entity with a portfolio exceeding 600 companies.
Strengthening the Web3 Landscape
With a well-established presence in Dubai, Animoca has been intensifying its efforts to cultivate the Web3 landscape across the Gulf region. The recent conditional approval from Abu Dhabi allows the firm to lay a stronger regulatory foundation, crucial for capital formation and establishing structured funds.
Managing Director for the Middle East, Omar Elassar, remarked that the UAE is rapidly becoming a bastion for Web3 and digital asset innovation. He emphasized that this provisional approval aligns with Animoca’s strategy to develop regulated avenues for institutional engagement while collaborating with various founders and enterprises within the digital ecosystem.
ADGM’s Broader Strategy
This initiative is part of ADGM’s broader strategy to encourage blockchain and digital firms to operate in a structured regulatory environment. Alongside its ventures in the Middle East, Animoca Brands is also pursuing a planned entry back into public markets. Recently, it secured a non-binding agreement with Nasdaq-listed Currenc Group for a potential reverse merger. This deal could position Animoca at a valuation nearing $1 billion and is expected to conclude by the end of 2026. If this merger occurs as planned, Animoca shareholders would control approximately 95% of the new entity, leaving Currenc’s shareholders with the remaining 5%.
Regulatory Process and Compliance
It is noteworthy that this provisional approval is just the first stage of the regulatory process. In Abu Dhabi, launching operations requires more than just this initial approval. Companies must engage in several pre-application discussions and present detailed regulatory business plans alongside other requisite documents, including ownership details, financial forecasts, and anti-money laundering frameworks. The FSRA meticulously reviews a firm’s technology, custody protocols, and key management personnel before granting in-principle approval, which is essentially a conditional endorsement rather than an outright license.
Those awarded provisional approval need to meet capital and operational criteria, such as satisfying base capital requirements and finalizing the necessary operational systems. Once they have verified compliance with these conditions within a specified period, they can obtain full Financial Services Permission, allowing them to operate legally and undertake various regulated activities involving virtual assets, with well-prepared firms typically completing this process in a few months.
