The United Arab Emirates is diving headlong for christening the initial coin offerings (ICOs) as a legal means-of-fundraising in 2019. The Gulf region predominantly depends on oil reserves, which are about to run out in the next 50 years. To avoid serious financial implications, the rulers of the seven Emirates have diversified into various industries such as tourism and banking. The introduction of the ICO regulation could bring in blockchain talent to knock their doors, adding another feather to their cap in the near future.
According to the Reuters report on Oct. 8, the country’s financial regulator, UAE’s Emirates Securities and Commodities Authority (SCA), stated in a seminar held on Oct. 7, that they will consider digital tokens as securities and provide legal companies as a legitimate method of crowd-based fundraising. The head of the SCA, Obaid Saif al-Zaabi, said:
“The board of the Emirates Securities & Commodities Authority has approved considering ICOs as securities. As per our plan, we should have regulations on the ground in the first half of 2019.”
The integrated such as whether the so-called “utility tokens” will be governed under the same rule or not are still unclear.
This move comes on the heel of reducing oil-reserve and oil prices that are constraining the economies one of the major sources of income. Inadvertently affecting the IPOs on Gulf stock markets.
In September, Richard Teng, the Abu Dhabi Global Market (ADGM) executive called for the proper regulations for cryptocurrency markets. In 2017, ADGM published a set of detailed and clear guidance on cryptocurrencies and ICOs, the document explained how ICOs can be deployed as a mechanism to raise funds and stated token investments could be treated as “special investments.”