After months of uncertainty Thailand’s Securities and Exchange Commission (SEC) has finally released its regulatory framework surrounding the buying and selling of digital tokens. The new system will be in place from July 16th.
Rather than try and constrain the ICO phenomenon, the Thai SEC has appeared to opt for a pragmatic approach by working to ensure that token sales are as legitimate and scam-free as possible.
The biggest innovation is the introduction of “ICO portals.” All ICOs must sell their tokens through these portals, which also act as something of a guarantor for investors.
The portals must be Thailand-based companies with a minimum registered capital of 5 million baht (just over $150,000 at current exchange rates). They must also be approved by the SEC that they are “adequate for business operations” and able to properly evaluate a whole host of criteria pertaining to their ICOs, including their business plans, codebase, token distribution and Know Your Customer procedures.
SEC secretary-general Rapee Sucharitakul said that he was “pleased to immediately discuss details” with any companies who wanted to come forward as ICO portals and that the SEC would ensure that they were “prepared for the regulatory framework.”
Once the first ICO portals have been approved then the SEC will turn its attention to the ICOs themselves. These must also be based in Thailand and have complete transparency in their business plans and token distribution. ICOs will have to disclose their code, prospectus and financial statements prior to being cleared for any offering.
The SEC has also placed restrictions on who can invest. “Ultra-high net worth individuals”, VC firms and private equity funds may invest as much as they please, while retail investors will be limited to 300,000 baht (around $9,000) per person, per project.
Rapee Sucharitakul, the secretary-general of the SEC, was keen to point out that despite the new procedures “an approved sale of digital tokens does not guarantee the success, price or return from fund-raising projects,” and that “investors should study information thoroughly and accept investment risks before making an investment.”