The United Arab Emirates (UAE) will soon add its name to the list of world regions to have provided regulatory certainty for Initial Coin Offerings (ICOs), according to reports from a local news source, The National Business. The legislative piece is expected to arrive before mid-year in 2019 to provide startups with an alternative source of crowdfunding for their businesses.
As per the report UAE’s Securities and Commodities Authority (SCA) has ruled to classify tokens issued by ICOs as securities. This status will bring the burgeoning industry under their watch since the body is also in charge of traditional finance instruments.
The SCA will now collaborate with the Abu Dhabi Securities Exchange and Dubai Financial Market to create blockchain based platforms on which ICO tokens can be traded just as on a stock exchange.
SCA's chief executive, Obaid Al Zaabi is quoted in the report as saying,
“We have signed agreements with law firms to come up with the sandbox and rulebooks for the issuance of ICOs.” The sandbox will be a framework that determines which ICOs can be issued to the public as the top official further explained.
Moving forward, Al Zaabi failed to give a precise date of when the whole process for ICO regulation in the UAE will be completed. Instead, he stated that legal requirements should be finalized by the end of the first half in 2019 while this will be followed by “the adoption of technology and development of infrastructure on the side of the exchanges” supporting ICO issuance.
For the time being though, he said that the agency is now open to accepting registration and licensing applications from startups who are interested in operating within the UAE market.
This latest development confirms earlier remarks by Jason King, a managing partner of the Dubai-based firm, Connected Global Strategies (CGS) that security token regulations will be announced in the UAE-city in early 2019.
Also, aside from the UAE, we had reported in November that Malaysia, France, and Uganda are the other countries who are currently working towards announcing regulations for the ICO and crypto industry in 2019.
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