UAE Warning Sparks Fresh Concerns That Crypto Bans May Loom
The UAE financial watchdog has raised fresh concerns over the safety of Initial Coin Offerings this week. The Securities and Authorities Commodity, who act as the financial regulator for the Emirates as a whole, has said that investments in ICOs would not be subject to any legal or regulatory protection. They also went on to say that tracking and recovery of lost investments may be extremely difficult.
What Does This Mean?
While it might look on the surface as if this is the beginning of something more significant, it might not in fact be bad news for crypto lovers in the region. The SAC’s assertion that those who invest in ICOs do so at their own risk, may in fact only serve as a way for them to distance themselves from any fall-out in case of large-scale fraud. They told their local media on Sunday that they “do not recognize, regulate or supervise” any ICOs whatsoever.
However, they will no doubt be passing their concerns on to the powers that be, and will clearly have plenty of influence. Indeed, financial regulating bodies around the world have been typically suspicious of crypto in general, especially the seemingly murky world of ICOs.
A further question to be considered would be if other countries began to rule that Bitcoin and its rivals were commodities. Doing so would then definitively put them under the jurisdiction of the SAC rather than the banking system, which could lead to stricter regulations from a more cautious governing body. However, doing this would also avoid any concern or confusion over the morality of cryptocurrency in terms of Islamic law. In general, most Islamic countries have declined to declare that cryptocoins should be banned in terms of laws governing lending and interest rates. But if the global community increasingly begin to determine that crypto currencies are best declared as commodities, it would certainly cement their legality in the Middle East.
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