It indicated, in an Arabic-English circular, that digital tokens are sold to investors in ICOs in exchange for cryptocurrencies. It further explained that ICO terms and features are case-specific and so is the nature of rights and interests acquired by investors (if any), indicating that ICOs are highly speculative and highly volatile in terms of prices.

SCA urged investors to be fully aware of the risks associated with ICO investments, most notably that:

• Some ICOs are not regulated and thus may be subject to fraud risks.
• ICOs may be issued abroad, and therefore are subject to foreign laws and regulations that can be difficult to verify. Tracking and recovering funds in case of ICO collapse may prove to be extremely difficult in practice.
• ICO trading on the secondary market is subject to opaque, volatile pricing and insufficient liquidity.
• Many investors, especially retail, may not be able to comprehend the risks, costs, and expected returns arising from ICO investments.
• ICO information made available to investors may be unaudited or incomplete and may present a given investment case in an unbalanced and misleading manner (by emphasizing the potential benefits while overlooking risks, for example). 
  
  
  SCA reiterated that it does not recognize, regulate, or supervise any ICO presently and that ICO investments are not offered legal or regulatory protection. It said that investors involved in ICO investments are doing so at their own risk. 
   
  SCA called upon digital token issuers, intermediaries advising on or facilitating digital token offerings, and digital token trading platforms to seek legal and regulatory advice to ensure compliance with all the applicable laws and regulations.  
  
  SCA added that it has recently formed a fintech team assigned with facilitating the implementation of fintech initiatives and keeping up with the latest fintech developments. 
  
  SCA's fintech team can be reached at fintech@sca.ae for any fintech-related enquiries.