ADGM is a financial free zone in Abu Dhabi with its own regulator, the FSRA, and English common law applied directly, while VARA regulates virtual asset activities across Dubai outside the DIFC. The FSRA integrates virtual asset activities into its broader financial services framework, with prudential, conduct and custody rules drawn from mainstream regulation and an accepted virtual assets approach. VARA instead issues separate rulebooks for each licensed activity. Licensing, capital, supervision and costs differ. The right choice depends on products, clients, investors, banking relationships and where the team will be based, so we compare both regimes.

Regulated activities include dealing in investments as principal or agent, arranging deals, advising, managing assets, providing custody and operating a multilateral trading facility, where these relate to virtual assets, along with related activities involving digital securities and fiat-referenced tokens. Pure technology services may fall outside the perimeter, but platforms that bring together buyers and sellers, hold client assets or recommend products usually do not. Each activity needs to be included in the Financial Services Permission. We map the business model against the current virtual asset regulation rules before an application is prepared, so nothing is missing.

The FSRA permits authorised firms to conduct regulated activities only in virtual assets that it has accepted for use, based on factors such as maturity, market capitalisation, liquidity, transparency of ownership and technology, and security. Firms may also be required to carry out their own due diligence on each asset. Privacy tokens are unlikely to be acceptable. Firms that want to support a new token should prepare analysis and engage with the FSRA before launch. We help firms prepare token assessments and understand how this part of virtual asset regulation affects their product plans and launch timetable.

Nationality does not itself prevent ownership. The FSRA assesses the fitness and propriety of controllers, directors and approved persons, including their source of funds and wealth, experience and regulatory history. A founder resident in Bangladesh must also consider Bangladesh law: overseas investment generally requires Bangladesh Bank approval, foreign assets and income must be disclosed for Bangladesh tax, and personal involvement in virtual currency activity raises questions given Bangladesh Bank's stance. We advise on both sides so that the ownership structure satisfies the FSRA and is lawful in Bangladesh under current virtual asset regulation and foreign exchange rules.

Capital requirements depend on the firm's prudential category and activities. Firms that operate trading facilities or hold client assets generally face higher requirements than those that only arrange or advise, and the FSRA may apply additional requirements based on expenditure, risk or specific virtual asset rules. Insurance and liquidity expectations may also apply. Because these requirements are revised, we check the current rules for each business model. For Bangladesh-based founders, sending capital abroad lawfully is a practical issue in itself and should be resolved before the application is submitted, with documents that a UAE bank will also accept.

An FSRA permission authorises activity in or from ADGM and does not authorise activity in Bangladesh. Bangladesh Bank has warned that virtual currency transactions are not authorised and may breach foreign exchange and anti-money laundering laws, and there is no Bangladesh licensing regime for crypto exchanges or brokers. Actively marketing to or onboarding Bangladeshi residents can therefore create legal risk for the firm, its founders and customers. Tokenised traditional assets raise separate securities and foreign exchange questions. We advise on geographic restrictions, onboarding controls and marketing policies that reflect virtual asset regulation in both jurisdictions.

Timing depends on the complexity of the activities, the applicant's ownership and controllers, the completeness and quality of the application, and responsiveness to FSRA questions. Steps include engagement with the FSRA before the formal application, entity registration, assessment, in-principle approval and final approval once conditions such as capital, premises, staff and systems are satisfied. Applications for exchanges and custodians typically take longer than advisory permissions, because systems, custody and market surveillance need closer review. We help clients plan realistically and prepare thoroughly, but timelines ultimately depend on the regulator's review and cannot be guaranteed by any adviser, however experienced.

The FSRA can require remedial action, impose financial penalties, restrict or vary permissions, withdraw approvals for individuals and, in serious cases, withdraw authorisation. It has published enforcement outcomes against firms and individuals. A firm facing a supervisory concern should preserve records, investigate the facts, respond accurately and promptly, and take legal advice before making admissions. Where Bangladesh-linked founders or customers are involved, the matter may raise separate questions under Bangladesh law. We coordinate the response with ADGM counsel and advise on a credible remediation plan and any rights of review or appeal.