Emirates News Agency – AJD Hosts Forum on “Legal System of Cryptocurrencies from the Perspective of International Experience”
ABU DHABI, January 6, 2022 (WAM) – “Legal System of Cryptocurrencies in International Experiences” was the title of the international forum organized by the Abu Dhabi Judicial Department (ADJD) to discuss newly designed systems around the world and exchange views and ideas on how to develop legislation that responds to these developments.
The forum was organized under the guidance of His Highness Sheikh Mansour bin Zayed Al Nahyan, Deputy Prime Minister, Minister of Presidential Affairs and Chairman of the Abu Dhabi Judicial Department, to apply best legal and judicial practices that enhance the business environment in line with the UAE’s vision for the next 50 years.
In his opening speech, Advisor Ali Al Shaer Al Dhaheri, Director of the Forensic Inspection Division, stressed the importance of discussing the issue of the legal system of cryptocurrencies as an important topic given its impact on global markets. It was necessary to consider all aspects related to these currencies and the risks they carry, making it necessary to define a legal and legislative framework to protect users and regulate their use in accordance with financial and economic regulations adopted around the world.
Judge Sultan Al Neyadi, President of the Abu Dhabi Commercial Court, discussed the effect of technological, financial and monetary advances on the judicial and legal environment, particularly in light of the challenges posed by digital currencies and the questions that they raise on the legality of their circulation. They form a virtual digital monetary system parallel to the traditional system which aims to achieve universality of exchanges through them, with the inherent risk of being used for the purposes of money laundering, criminal activity or tax evasion. , in addition to the difficulty of confiscating or finding them due to the ease with which they are obtained by creating online accounts which are otherwise ultra-secure with user data completely obscured.
He also mentioned the risks associated with the use of cryptocurrencies with a possible exposure to hacking or infiltration in the absence of an equivalent value for this currency. It calls into question their credit guarantees, the impossibility of compensation in the event of a claim for any reason whatsoever. Their confidentiality obscures their actual data, resulting in tax losses for countries due to the lack of precise information regarding this type of currency. In addition, the unavailability of specific controls on this issue deprives users of protection against increased hacking operations, as users have no binding disclosure and reporting obligations as is the case with decided procedures. by central banks, he said.
Clayton J. Conlan, a judge of the Superior Court of Justice of Canada, reviewed the evolution of digital currencies over the past 12 years, their use in the public domain and their rise in value, as well as the problems associated with their weakening of the role of the authorities by circumventing established controls. Therefore, work needs to be done to find a certain balance between encouraging innovation under specific controls and controlling these technological innovations. This is the challenge that governments around the world seek to meet by strengthening controls and preventing their use in criminal operations, he added.
Adviser Ehab Ebrahim, of the Judicial Inspection Division, provided an update on the legislative scope of the forms and modalities of circulation of cryptocurrencies and the risks they pose to the financial sector. He highlighted the difference between cryptocurrencies issued by individuals or unknown entities and currencies issued by central banks and traded by licensed companies. He said this requires expanding the scope of modern legal theories to include all cryptocurrency transactions and regulate the relationship between the user and the trading platform.
British Judge Naveen Agnihotri, of the Abu Dhabi Commercial Court, discussed the legal system of cryptocurrencies in several countries, the applicable legislation governing cryptocurrencies and the companies that market them, in addition to government policies and the general approach to their regulation, as well as the regulators and the penalties that regulators may impose for violations related to these assets.