Open-source distributed ledger IOTA has pioneered digital infrastructure in the UAE with the launch of a development foundation in Abu Dhabi. The news triggered the native token of the ecosystem, $IOTA, to jump by over 40% on Wednesday.
The IOTA Ecosystem DLT Foundation is claimed to be the first registered foundation under the regulatory framework set up by the country’s financial watchdog, the Abu Dhabi Global Market (ADGM).
As per the official press release, the foundation will be seeded with over $100 million in $IOTA tokens, to be vested over the next four years. This funding will be utilised to nurture its ecosystem and accelerate the growth of the protocol.
It also seeks to build partnerships in the region in order to advance the adoption of IOTA and its staging network, Shimmer, across various sectors. Shimmer Network is a feeless interoperability layer engineered to scale boundless decentralised Web3 economies.
Plans to establish this regulated foundation in Abu Dhabi were first revealed in September to propel IOTA’s position as a DLT leader in the MENA (Middle East and North Africa) region and globally.
The CEO of the Registration Authority (RA) of ADGM, Hamad Sayah Al Mazrouei, commented on the move saying: “Welcoming IOTA, one of the most established and well-respected blockchain protocols into ADGM’s DLT regime exemplifies our ambition to position Abu Dhabi’s stature as a prime location and ADGM as the leading jurisdiction for the blockchain industry. It is a strong validation of ADGM’s progress with its new and revolutionary DLT Foundations Framework. Working with companies like IOTA, ADGM aims to move towards a future characterised by setting global benchmarks in the ever-evolving blockchain and Web3 landscape”.
Crypto-friendly hub welcomes IOTA
The UAE has been aiming to cultivate a flourishing crypto community within the legal and regulatory framework of ADGM recently. Early in 2023, the country had announced that it would pour roughly $2 billion into Web3 and blockchain startups to attract builders to its economic free zone.
Back when IOTA unveiled plans for its DLT Foundation, the Chairman of the IOTA Foundation, Dominik Schiener, remarked: “From the very beginning, we have experienced a very warm welcome and unwavering support from leaders, regulators, and businesses in Abu Dhabi. I am simply amazed at how the country operates and how it is being led by visionary and open-minded leaders. This ‘can-do’ mentality is the perfect environment for us to take IOTA to the next level. We are excited to play a role in helping to establish the UAE as a hub for technology innovations.”
On the same day IOTA got the greenlight from ADGM, crypto firm Paxos also received two in-principle approvals in Abu Dhabi. As per the company announcement, the Financial Services Regulatory Authority (FSRA) in the ADGM has allowed Paxos to issue stablecoins and offer crypto brokerage and custody services in the country.
However, these are preliminary approvals for the two new entities within the ADGM and full approvals are expected to be given in the first half of next year. The move came after another in-principle approval for Paxos from the Monetary Authority of Singapore. This was for its new local entity that will launch a new USD-backed stablecoin in the country.
Earlier this month, Liminal Custody also bagged an in-principle approval from the FSRA. While the approval is not a licence per se, the India-based provider of custody services for digital assets described it as “an important milestone”. Founded in 2021, Liminal was granted an operating licence in Hong Kong earlier this year too.
A momentary price spike
The debut of the new foundation helped $IOTA to jump in price, hitting a 6-month high of $0.285236. However, at the time of press, it was down by over 8% in a day.
The market’s positive reaction also increased IOTA’s market capitalisation and 24-hour trading volume by 36.82% and 10,776.86%, reaching $719,502,547 and $747,679,281 respectively.
At the time of press, it was changing hands for $0.2309, struggling to maintain its trade in the green. Nonetheless, the token is still up by over 30% weekly.