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Abu Dhabi Admits 4 Blockchain Startups to Fintech Sandbox

The Abu Dhabi Global Market (ADGM) – the city’s international financial free zone within the UAE – has admitted a second batch of fintech startups to its Regulatory Laboratory (RegLab).

With the move, the 11 local and international fintech firms will work under the framework of the Financial Services Regulatory Authority (FSRA), one of three independent authorities of the ADGM, to develop and test their products within a controlled “sandbox” environment.

The latest batch of startups – including blockchain firms EquiChain and OKLink, both based in the U.K.; UAE-based Pyppl; and Canadian firm Remitr – were selected from over 20 applications from various countries, according to a press release.

Richard Teng, CEO of the FSRA, said that the second phase was encouraged by “overwhelming positive response from the global fintech industry in the first year of the RegLab programme.”

He continued:

“We are already seeing some great results from the first cohort, and are looking forward to seeing results from the second, which include fascinating projects such as an initial coin offering and blockchain-enabled payments, settlements and RegTech solutions, among others.”

With a total of 16 startups now within RegLab, including five from the first batch, ADGM said it is seeking to expand its team to better serve the financial services industry and the country’s economy.

Abu Dhabi image via Shutterstock

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Abu Dhabi Markets Regulator Publishes ICO Guidance

The government of Abu Dhabi has released new guidelines for those looking to organize or participate in an initial coin offering (ICO).

Abu Dhabi Global Market’s Financial Services Regulatory Authority (FSRA) said that it would apply existing anti-money laundering and know-your-customer (KYC) rules to token sales, classifying some as securities (depending on their makeup and underlying structure) and others as commodities. Like a growing number of regulators worldwide, the agency said that it would weigh the sale and release of blockchain-based tokens on a case-by-case basis.

The nine-page circular published yesterday includes instances in which a token sale would fall under or outside the definition of a security under Abu Dhabi law. Because the circumstances of such a determination may vary from project to project, the agency urged organizers within the region to “engage with us as early as possible in the fundraising process.”

Richard Teng, the chief executive director of the FSRA, later said in a statement:

“Participants exploring the issuance of ICOs that offer real value to the market and wish to operate within our regulatory framework are encouraged to engage us early to gain insights into the applicable regulatory regime.”

Tokens which are not treated as securities will be treated as commodities, along with cryptocurrencies more generally. As a result, their trades will not be regulated by the FSRA, according to the circular. That specific determination notably brings the FSRA in line with the Commodity Futures Trading Commission, which revealed that it would regulate the US-based market in late 2015.

Image Credit: Konstantin Tcelikhin / Shutterstock.com

The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at news@coindesk.com.