Security In Code, Compliance In Law: SCA's New Era For Tokenised Assets In The UAE

KEY TAKEAWAYS

• The UAE Securities and Commodities Authority has released draft regulations for security tokens and commodity token contracts, aiming to regulate digital assets and integrate blockchain technology into traditional financial markets.
• The draft regulations provide clear legal definitions for security tokens (representing securities like equity or bonds) and commodity token contracts (representing physical commodities like gold or oil), offering legal certainty to market participants.
• Trading and settlement of these tokens must occur on licenced exchanges or SCA-recognised Alternative Trading Systems, with over-the-counter trading limited to bonds and sukuk tokens.