UAE plans initial coin offerings to boost capital markets — regulator

View of Burj Khalifa the tallest building from the Business Bay area in Dubai, UAE July 8, 2018. Picture taken July 8, 2018. (Reuters)
Updated 08 October 2018
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UAE plans initial coin offerings to boost capital markets — regulator

  • In ICOs, companies issue cryptocurrency tokens to investors
  • ESCA is drafting regulations for ICOs with international advisers

ABU DHABI: The United Arab Emirates plans to introduce initial coin offerings (ICOs) next year to provide companies with a fresh way to raise money, the head of the securities regulator said on Monday.
In ICOs, companies issue cryptocurrency tokens to investors, in much the same way as they issue shares in an initial public offer of equity.
“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 told a seminar.
ESCA is drafting regulations for ICOs with international advisers and is working with the Abu Dhabi and Dubai stock markets to develop trading platforms for the offers, he said, adding that details would be announced later.
Weak equity markets coupled with low oil prices in the last several years have severely constrained IPOs in the UAE and the Gulf Arab region as a whole.
A new law may take effect in 2019 to facilitate IPOs in which family owners sell majority or 100 percent stakes in the companies they control, Zaabi said. “The Ministry of Economy has written to the prime minister’s office and we are awaiting approval.”
Other initiatives under way include having a minimum of 20 percent women on the boards of listed companies, he said.


Abu Dhabi aims to lure start-ups with investment in new technology hub

Updated 24 March 2019
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Abu Dhabi aims to lure start-ups with investment in new technology hub

  • The initiative will help Abu Dhabi reduce reliance on oil
  • Mubadala hopes to attract Chinese and Indian companies

ABU DHABI: Abu Dhabi will commit up to $272 million to support technology start-ups, it said on Sunday, in a dedicated hub as part of efforts to diversify its economy.

US tech giant Microsoft will be a strategic partner, providing technology and cloud services to the businesses that join the hub as the capital of the United Arab Emirates continues its push to reduce reliance on oil revenue.
Abu Dhabi derives about 50 percent of its real gross domestic product and about 90 percent of central government revenue from the hydrocarbon sector, according to ratings agency S&P.
The emirate launched a $13.6 billion stimulus fund, Ghadan 21, in September last year to accelerate economic growth. Ghadan means tomorrow in Arabic. The new initiative, named Hub 71, is linked to Ghadan will also involve the launch of a $136 million fund to invest in start-ups, said Ibrahim Ajami, head of Mubadala Ventures, the technology arm of Mubadala Investment Co.
The goal is to have 100 companies over the next three to five years, Ajami said. “The market opportunities in this region are immense,” he added.
Mubadala, with assets of $225 billion and a big investor in tech companies, will act as the driver of the hub, located in the emirate’s financial district.
Softbank will be active in the hub and support the expansion of companies in which it has invested, Ajami said, adding that Mubadala is also aiming to attract Chinese and Indian companies, among others.
Mubadala which has committed $15 billion to the Softbank Vision Fund, plans to launch a $400 million fund to invest in leading European technology companies.
Incentives mapped out by the government include housing, office space and health insurance as part of the $272 million commitment, Ajami said.
Abu Dhabi will also announce a new research and development initiative on Monday linked to the Ghadan 21 plan, according to an invitation sent to journalists.