AirCarbon Exchange (ACX) has announced that ACX Abu Dhabi, an exchange and clearing house in Abu Dhabi Global Market (ADGM), is now live. Key transactions have already been carried out and settled on the platform.
In August 2021, ACX founded its regional headquarters within ADGM, aided by Hub71, the global tech ecosystem in Abu Dhabi. Hub71 is driven by Mubadala Investment Company PJSC (Mubadala), a sovereign investor in Abu Dhabi. Mubadala made an investment in ACX in September 2022.
ADGM, which serves as the international financial center of the UAE’s capital and operates as a financial-free zone, last September became the first jurisdiction to regulate voluntary CO2 credits as financial instruments. This was realized through the establishment of an Environmental Instrument classification, a regulatory framework that encompasses the licensing of exchanges and clearing houses for both spot and derivatives markets related to these products.
In November 2022, ACX Abu Dhabi obtained the first license under the framework and became the world’s first regulated Recognised Investment Exchange and Recognised Clearing House that offers Environmental Instruments in the form of CO2 credits.
With secured investments and approved regulatory licenses in place, ACX established the necessary foundation for the participation of Voluntary Carbon Market (VCM) entities in trading carbon credits and other environmental instruments.
The first-ever carbon credits trade was executed between First Abu Dhabi Bank (FAB) and the specialized CO2 trading firm Helix Climate.
“We are delighted to execute the first trade on ACX Abu Dhabi,” said Sameh Al Qubaisi, Group Head of Global Markets at First Abu Dhabi Bank. “As the UAE’s largest bank, we are keen to support the expansion and potential of carbon markets to provide price signals that can help companies reduce or remove their greenhouse gas emissions in the most efficient way.”
ACX Abu Dhabi also announced the first trade on its Carbon Market Board (CMB), an electronic trading facility enabling participants to conduct over-the-counter transactions. The trade was successfully completed with climate project developer South Pole.