As part of its leading role in regulating and advancing the UAE’s capital markets—and in keeping with its established practice of seeking input from financial industry partners before finalizing new regulations—the Securities and Commodities Authority (SCA) has published a draft regulation on security tokens and commodity tokens on its website, www.sca.gov.ae. It invites stakeholders, experts, and relevant parties to provide their input and insights, which will be carefully considered when shaping the final version of the regulation. To access the draft regulation, click here.
This draft regulation is the first of its kind in the UAE’s capital markets, marking a significant milestone in the issuance and trading of security tokens and commodity tokens. By integrating traditional elements of securities and commodities and modern financial technologies, these tokens provide investors with more efficient and resilient investment tools.
The regulation comprises 18 articles that outline the scope of application, define security tokens and commodity tokens, and discuss the implications of issuing such tokens. It further addresses the applicable technical standards and includes rules governing trading, settlement, pledging, and cancellation. It also covers the obligations associated with issuing security tokens and commodity tokens, along with other key topics.
The SCA has invited all stakeholders in the UAE’s capital markets, including investors, brokers, financial analysts, scholars, media personnel, and others to review the draft regulation and send their feedback by February 14, 2025, to registration@sca.ae.
