6.3.1. Admission to Trading Rules

(1) An Authorised Private E-currency Trading Facility must make clear and transparent rules concerning the admission of Private E currencies to trading on its facilities.

(2) The rules of the Authorised Private E-currency Trading Facility must ensure that:

• (a) Private E-currencies admitted to trading on an Authorised Private E-currency Trading Facility’s facilities are capable of being traded in a fair, orderly and efficient manner; and
• (b) Private E-currencies admitted to trading on an Authorised Private E-currency Trading Facility’s facilities are freely negotiable.

6.3.2. Application for admission of Digital Assets to Trading

(1)Applications for the admission of a Digital Asset to trading can be made to an Authorised Digital Asset Trading Facility by the issuer of the Digital Asset, by a third party on behalf of and with the consent of the issuer of the Digital Asset, or by a Member of an Authorised Digital Asset Trading Facility.

(2)A Digital Asset can also be admitted to trading on the Authorised Digital Asset Trading Facility’s own initiative.

(3)An Authorised Digital Asset Trading Facility must, before admitting any Digital Asset to trading:

(a)be satisfied that the applicable requirements, including those in its Admission to Trading Rules, have been or will be fully complied with in respect of such Digital Asset and

(b)obtain approval of the AFSA in respect of such Digital Asset.

(4)For the purposes of (1), an Authorised Digital Asset Trading Facility must notify an applicant in writing of its decision in relation to the application for admission of the Digital Asset to trading. In the case that such decision is to deny the application, the written notice should indicate (i) whether the application has been considered by the AFSA, and if so, (ii) the AFSA’s determination in respect thereof.

(5)For purposes of 3(b), an application to AFSA by Authorised Digital Asset Trading Facility shall include:

(a)a copy of the admission application; and

(b)any other information requested by the AFSA.

6.3.3. Decision-making procedures for the AFSA in relation to applications for approval of the admission of Digital Assets to trading

(1)Where an Authorised Person Operating a Digital Asset Trading Facility applies for approval of the admission of a Digital Asset to trading, the AFSA may:

1. (a)approve the application;
2. (b)deny the application; or
3. (c)approve the application subject to conditions or restrictions.

(2)The AFSA may exercise its powers under (1)(b) where the AFSA reasonably considers that:

1. (a)granting the Digital Assets admission to trading of Digital Assets would be detrimental to the interests of Persons dealing in the relevant Digital Assets using the facilities of an Authorised Person Operating a Digital Asset Trading Facility or otherwise; or
2. (b)any requirements imposed by the AFSA or in the Rules of an Authorised Digital Asset Trading Facility as are applicable have not been or will not be complied with; or
3. (c)the Issuer of the Digital Assets has failed or will fail to comply with any obligations applying to it including those relating to having its Digital Assets admitted to trading or traded in another jurisdiction.

(3)Where the AFSA denies an application for approval of admission of a Digital Asset to trading pursuant to (2), such Digital Assets must not be admitted by an Authorised Person Operating a Digital Asset Trading Facility to its facility.

(4)Where the AFSA approves an application for approval of admission of a Digital Asset to trading subject to conditions or restrictions, the Authorised Person Operating a Digital Asset Trading Facility is responsible for implanting such conditions and restrictions in admitting the Digital Asset to trading, and such conditions or restrictions may not be varied or removed without the approval of the AFSA.

6.3.4. Undertaking to comply with the acting law of the AIFC

An Authorised Digital Asset Trading Facility may not admit Digital Asset to trading unless the person who seeks to have Digital Assets admitted to trading:

1. (a)gives an enforceable undertaking to the AFSA to submit unconditionally to the jurisdiction of the AIFC in relation to any matters which arise out of or which relate to its use of the facilities of the Authorised Market Institution;
2. (b)agrees in writing to submit unconditionally to the jurisdiction of the AIFC Courts in relation to any disputes, or other proceedings in the AIFC, which arise out of or relate to its use of the facilities of the Authorised Market Institution; and
3. (c)agrees in writing to subject itself to the acting law of the AIFC in relation to its use of the facilities of the Authorised Market Institution.

6.3.5. Review of compliance

The Authorised Digital Asset Trading Facility must maintain arrangements regularly to review whether the Digital Assets admitted to trading on its facilities comply with the Admission to Trading Rules.

6.4.1. Power to suspend

(1)The rules of an Authorised Digital Asset Trading Facility must provide that the Authorised Digital Asset Trading Facility have the power to suspend or remove from trading on its facilities any Digital Assets with immediate effect or from such date and time as may be specified where it is satisfied that there are circumstances that warrant such action or it is in the interests of the AIFC.

(2)The AFSA may direct an Authorised Person Operating a Digital Asset Trading Facility to suspend or remove Digital Assets from trading with immediate effect or from such date and time as may be specified if it is satisfied there are circumstances that warrant such action or it is in the interests of the AIFC.

(3)The AFSA may withdraw a direction made under (2) at any time.

(4)Digital Assets that are suspended from trading of Digital Assets remain admitted to trading for the purposes of this Chapter.

(5)The AFSA may prescribe any additional requirements or procedures relating to the removal or suspension of Digital Assets from or restoration of Digital Assets to trading.

6.4.2. Limitation on power to suspend or remove Digital Assets from trading

The rules of an Authorised Digital Asset Trading Facility must contain provisions for orderly suspension and removal from trading on its facilities any Digital Asset which no longer complies with its rules taking into account the interests of investors and the orderly functioning of the financial markets of the AIFC.

6.4.3. Publication of decision

(1)Where the Authorised Digital Asset Trading Facility suspends or removes any Digital Asset from trading on its facilities, it must notify the AFSA in advance and make that decision public by issuing a public notice on its website.

(2)Where the Authorised Digital Asset Trading Facility lifts a suspension or re-admits any Digital Asset to trading on its facilities, it must notify the AFSA in advance and make that decision public by issuing a public notice on its website.

(3)Where an Authorised Digital Asset Trading Facility has made any decisions on admission, suspension, or removal of Digital Assets from trading on its facilities, it must have adequate procedures for notifying users of such decisions.

6.5.1. Trading transparency obligation

An Authorised Digital Asset Trading Facility must make available to the public:

1. (a)the current bid and offer prices of Digital Assets traded on its systems on a continuous basis during normal trading hours;
2. (b)the price, volume and time of the transactions executed in respect of Digital Assets traded on its facilities in as close to real-time as technically possible; and
3. (c)provide price, volume, time and counterparty details to the AFSA within 24 hours of the close of each trading day via a secure electronic feed.

6.5.2. Public notice of suspended or terminated Membership

The Authorised Digital Asset Trading Facility must promptly issue a public notice on its website in respect of any Member that has a Licence to carry on Market Activities or Regulated Activities whose Membership is suspended or terminated

6.5.3. Cooperation with office-holder

The Authorised Digital Asset Trading Facility must cooperate, by the sharing of information and otherwise, with the AFSA, any relevant office-holder and any other authority or body having responsibility for any matter arising out of, or connected with, the default of a Member of the Digital Asset Trading Facility.

6.6.1. Cyber-security policy

(1)An Authorised Digital Asset Trading Facility shall implement a written cyber security policy setting forth its policies and procedures for the protection of its electronic systems and members and counterparty data stored on those systems, which shall be reviewed and approved by the Authorised Digital Asset Trading Facility’s governing body at least annually.

(2)The cyber security policy must, as a minimum, address the following areas:

1. (a)information security;
2. (b)data governance and classification;
3. (c)access controls;
4. (d)business continuity and disaster recovery planning and resources;
5. (e)capacity and performance planning;
6. (f)systems operations and availability concerns;
7. (g)systems and network security;
8. (h)systems and application development and quality assurance;
9. (i)physical security and environmental controls;
10. (j)customer data privacy;
11. (k)vendor and third-party service provider management; and

(l)incident response.

(3)An Authorised Digital Asset Trading Facility must advise the AFSA immediately if it becomes aware, or has reasonable grounds to believe, that a significant breach by any Person of its cyber security policy may have occurred or may be about to occur.

6.6.2. Technology governance

An Authorised Digital Asset Trading Facility must, as a minimum, have in place systems and controls with respect to the procedures describing the creation, management and control of digital wallets and private keys.

6.6.3. Trading controls

An Authorised Digital Asset Trading Facility must be able to:

1. (a)reject orders that exceed its pre-determined volume and price thresholds, or that are clearly erroneous;
2. (b)temporarily halt or constrain trading on its facilities if necessary or desirable to maintain an orderly market; and
3. (c)cancel, vary, or correct any order resulting from an erroneous order entry and/or the malfunctioning of the system of a Member.

6.6.4. Settlement and Clearing facilitation services

(1)An Authorised Digital Asset Trading Facility must ensure that satisfactory arrangements are made for securing the timely discharge (whether by performance, compromise or otherwise), clearing and settlement of the rights and liabilities of the parties to transactions effected on the Authorised Digital Asset Trading Facility (being rights and liabilities in relation to those transactions).

(2)An Authorised Digital Asset Trading Facility acting as a Digital Asset Depository must:

1. (a)have appropriate rules, procedures, and controls, including robust accounting practices, to safeguard the rights of Digital Assets issuers and holders, prevent the unauthorised creation or deletion of Digital Assets, and conduct periodic and at least daily reconciliation of each Digital Asset balance it maintains for issuers and holders;
2. (b)prohibit overdrafts and debit balances in Digital Assets accounts;
3. (c)maintain Digital Assets in an immobilised or dematerialised form for their transfer by book entry;
4. (d)protect assets against custody risk through appropriate rules and procedures consistent with its legal framework;
5. (e)ensure segregation between the Digital Asset Depository’s own assets and the Digital Assets of its participants and segregation among the Digital Assets of participants; and 
6. (f)identify, measure, monitor, and manage its risks from other custody related activities that it may perform.