The United Arab Emirates has just announced its plans to introduce rules that will allow domestic companies to use ICOs for fundraising. The new regulations should be in place in 2019, according to Reuters.
“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,” Obaid Saif al-Zaabi, head of the UAE’s securities watchdog, told a seminar.
Effectively this will allow businesses to consider using an ICO instead of an IPO. Zaabi said that draft rules are already being drawn up by the regulator in conjunction with advisers from outside of the country, and that they are working with the stock markets in Abu Dhabi and Dubai as well, so that they can prepare platforms for digital assets.
According to Reuters this move may have come due to the lacklustre equities market in the UAE in recent years, which combined with lower oil prices has reduced the number of IPOs. As a result, as well as providing new laws for ICOs, the Emirates may also draw up a new law to boost the number of IPOs by allowing family owners sell up to 100 percent of firms under their control.
When the new ICO rules come into law next year, this will make the UAE one of the countries in the world to have brought in a regulatory framework for the blockchain funding method. Malta is an example of another country with the same ambitions, although it is further down the road than the UAE and has already passed several bills for ICOs, cryptocurrency and blockchain technology earlier this year as part of its plan to become a “Blockchain Island.” Malta’s prime minister told the UN that cryptocurrency is the “inevitable future of money,” and it seems more are coming around to this way of thinking.