In the world of virtual assets, the legislative sphere can often be complicated and ever-changing. For crypto financiers looking to expand their functions, apprehending local legislations is paramount. This region, with its strong monetary sector and business-friendly environment, has become a promising place for tokenized ventures, suggesting a strategic hub for commercials searching for a…
With the expanding popularity of e-cryptocurrencies, this direction has become one of the prime locations for establishing fund vehicles. Digital holdings are maturing into a crucial part of both conventional and specialised portfolios. In 2021, one-third of conventional fund vehicles ventured in digital holdings, and two-thirds planned to amplify their ventures in 2022. Notably, this…
This type of licence is increasingly relevant as this region becomes a hub for e-currency operations. To obtain VASP licence in Argentina is essential for operating legally within Argentina’s growing crypto market, offering multiple benefits from regulatory support to potential tax incentives. Advantages of VASP Licence Demands for receiving this type of licence The submission…
The Swiss Financial Market Supervisory Authority (FINMA) is the cornerstone of economic regulation in Switzerland, a country known globally for its robust economic services sector. As an independent establishment, FINMA plays a critical role in maintaining the integrity, stability, and reputation of Switzerland’s economic markets. This article delves into the history, structure, functions, and significance…
An established and fully operational group specializing in the forex brokerage industry is now available for acquisition. This group includes multiple entities with financial licenses, a comprehensive online presence, and a complete infrastructure supporting marketing, sales, and customer service. The structure offers investors a turnkey solution with an extensive global reach. Key Details of Forex…
The Ready-Made company with AISP License holds an EU AISP (Account Information Service Provider) license issued by the Danish Financial Supervisory Authority, enabling it to provide account information services across the EU. EU Passporting: The license allows for passporting to all EU member states, providing extensive opportunities for expansion across Europe. Bank Account: The Company…
Overview EMI License in Georgia This company, licensed by the National Bank of Georgia since 2015, is a well-established provider in Georgia’s financial services market, known for a broad range of innovative payment solutions and extensive reach across the country. Key Services E-Money Issuing: Reliable electronic money issuance services. Multi-Currency E-Wallet & Account: Efficient fund…
Key Details of this Lithuanian VASP: Licensed VASP: Established in 2021 with full authorization from FNTT. Banking Setup: Active PSP account with a Lithuanian EMI for smooth operations, and a local bank account for tax and salary payments. Financial Stability: No loans or debts, in good standing, compliant with AML/KYC regulations. Legal and Operational Support:…
Zurich
+41 435 50 73 23Kyiv
+38 094 712 03 54London
+44 203 868 34 37Tallinn
+372 880 41 85Vilnius
+370 52 11 14 32New York
+1 (888) 647 05 40An Initial Coin Offering (ICO), also called an Initial Token Offering (ITO), is a common crowdsale mechanism (collectively collaborating to pool financial resources to invest in a project) by selling crypto coins or tokens in exchange for virtual money (usually bitcoin or ether) or fiat currency.
Early investors usually buy coins or tokens in the hope that the project will be launched successfully. Therefore, the value of the coins or tokens will increase. However, this method of funding is controversial due to fraudulent schemes under the guise of ICOs.
Blockchain specialists are currently working on a fair ICO standard capable of preventing fraudulent schemes. Many worldwide organizations published notices.
Although the laws governing ICOs have not yet been issued in the UAE, in October 2017, the Financial Services Regulatory Authority (FSRA) of the Abu Dhabi Global Marketplace (ADGM). It is a financial free zone in Abu Dhabi, issued an instruction with guidance on ICO regulation.
It clarified that the tokens sold would be treated as securities or as specific investments or commodities, depending on the underlying legal structure and assets.
ICOs defined as securities or investments require strict adherence to the rules for the circulation of securities. At the same time, ICOs that are classified as services are not necessarily regulated in this way.
Other UAE regulators have been more cautious. In September 2017, the Dubai Financial Services Authority (DFSA) of the Dubai International Financial Center Free Zone issued a general warning about investing in cryptocurrencies and ICOs.
In addition, the Securities and Commodities Authority (SCA), the Securities and Commodities Regulator of the UAE, on 4/02/2018 issued a notice stating that token-based fundraising is risky.
Despite the warnings against ICOs / ITOs, these documents are notable for not declaring a ban on ICOs / ITOs. The DFSA and SCA not regulated them.
An ICO can also be initiated through a company established in an “ICO-friendly” jurisdiction such as Gibraltar, Switzerland, Singapore.
Several ICOs have been announced in the UAE over the past six months, including Afterschool, Royal Kingdom Coin and FARAD. Afterschool’s initiators sold 11 million tokens. But then stopped the sale, stating that they would return the funds raised to buyers in light of the aforementioned ADGM FSRA circular.
ICO Royal Kingdom Coin raised a more modest amount. UAE is fertile ground for ICOs in the near future.
Companies considering issuing an ICO should pay close attention to the controversial, rapidly changing legal policy of ICOs and, in any case, will seek competent legal advice.
To get advice on registering a company for ICO in the UAE, please contact our specialist.
The international company Eternity Law International provides professional services in the field of international consulting, auditing services, legal and tax services.