The United Arab Emirates (UAE) has announced plans to introduce new rules that would allow the initial coin offering (ICO) to be used as a method of raising funds for local companies.
According to Reuters ' forecast released on Monday, the rules planned for 2019 will allow firms to raise capital through cryptocurrency sales as an alternative to traditional methods of raising funding, such as IPO.
The news was revealed by the head of the UAE securities observer Obeid Saif al-Zaabi, who said at the seminar today:
The Board of the Emirates Securities & Commodities Authority approved the consideration by the ICO as a sale of securities. According to our plan, we should introduce rules on the ground in the first half of 2019.
"The draft rules covering ICO are already being developed by the regulator in cooperation with foreign advisers," Zaabi said, adding that the regulator is also working with the stock markets in Abu Dhabi and Dubai to prepare trading platforms for new digital assets.
Reuters points out that in recent years, fluctuations and low oil prices, as well as the weakness of the stock market, have reduced IPO activity in the UAE. In addition to providing a legal framework for the ICO, the country may also develop a new law to increase the number of IPOs by allowing family owners to sell up to 100 percent of the firms under their control.
When the new rules for ICO come into force, the UAE will become one of the countries in the world that have implemented a regulatory framework for the method of financing with the help of blockchain. Malta, for example, passed several bills to provide a legal framework for ICO, cryptocurrency, and blockchain technology earlier this year as part of its plan to become a "Blockchain island." Bermuda also hopes to attract more businesses to the island by providing legislation that would allow for ICO in certain conditions.
Link to the source of information (Russian) - https://altstake.io/news/oae-razreshit-ico-v2019-godu