Nick Philpott, co-founder of Zodia Markets, compared the regulatory environments in Abu Dhabi and the UK, noting that Abu Dhabi’s process is faster and more interactive with regulatory authorities. He highlighted the delays and complexity in the UK’s regulatory process, particularly in obtaining registrations with the Financial Conduct Authority under anti-money laundering laws. He also mentioned similar cautious approaches in Ireland, where the number of approved entities remains relatively low.
Philpott pointed out that the delays in the UK were attributed to the high volume of applications lacking quality and the resource constraints of the FCA in processing these applications. He acknowledged the challenge of retaining experienced staff in the regulatory sector due to more lucrative opportunities in the private sector. Philpott suggested that offering higher compensation for regulators could be a potential solution to attract and retain talent.
In contrast to the UK, Philpott praised Abu Dhabi’s Financial Services Regulatory Authority (FSRA) for its high level of responsiveness and proactive approach. He commended the prompt communication channels and swift replies to inquiries, even on complex matters. The FSRA initiated Zodia’s licensing process within two weeks of initial contact, demonstrating a collaborative and engaging approach to regulation.
Zodia Markets began its regional search in late 2021, targeting regulatory frameworks in Dubai and Abu Dhabi. Philpott identified Abu Dhabi Global Markets (ADGM) as a regulator with experience in overseeing certain counterparties, including mid-chains. With the establishment of Dubai’s Virtual Assets Regulatory Authority (VARA), Philpott underscored the importance of establishing a physical presence in the Emirates to combine Standard Chartered’s foreign exchange services with crypto for institutional clients.
As part of its expansion efforts, Philpott relocated to Abu Dhabi from the UK and assumed the role of Head of Partnerships at Zodia Markets. He highlighted the potential collaboration with Standard Chartered, a major bank in the UAE, to offer a combination of foreign exchange and crypto services to institutional clients. Philpott also noted the construction activity in Abu Dhabi as a sign of the city’s ongoing development and growth potential, reflecting the favorable business environment for Zodia’s operations in the region.
Overall, Philpott’s positive experience with Abu Dhabi’s regulatory authorities and the favorable business environment in the region contrasted with the challenges faced in the UK’s regulatory landscape. He emphasized the importance of regulatory collaboration and responsiveness in facilitating business operations and highlighted the potential for growth and innovation in the crypto industry in Abu Dhabi. Zodia Markets’ strategic approach to regulatory compliance and partnerships with established financial institutions position the firm for success in the evolving crypto market.
