UAE's SCA to regulate initial coin offerings

The UAE’s Securities and Commodities Authority (SCA) has approved a plan to regulate initial coin offerings (ICOs) and recognise them as securities, SCA chairman and Minister of Economy Sultan bin Saeed Al Mansouri said on Sunday.

The decision comes after the SCA has reviewed a study on best international practices, and includes a set of mechanisms as part of an integrated project to regulate digital securities and commodities, according to WAM news agency.

The resolution shall go into effect when it is published in the UAE’s Official Gazette.

In February, the SCA warned investors to be cautious about digital, token-based fundraising activities or fundraising schemes, including initial coin offerings (ICOs) and token presales or crowd sales.

In a statement, the SCA said that ICO terms and features are case specific, as is the nature of rights and interests acquired by investors. As such, the SCA notes that ICOs are highly speculative, with prices highly volatile.

The SCA urged investors to be aware of the risks and noted that any investors involved in ICOs are doing so at their own risk.

Additionally, at the time the SCA called upon digital token issuers to seek legal and regulatory advice to ensure compliance with applicable laws and regulations.

Arabian Contribution Time: 10-Sep-2018 06:41 (GMT)
Arabian Last Update Time: 10-Sep-2018 06:41 (GMT)