March 13, 2019, | AtoZ Markets - The Board of Directors of the Securities and Exchange Commission of Thailand (SEC) approved the country's first ICOs portal. Also, the regulator is expected to issue criteria for STO applications in Thailand soon. Will Thailand become a hub for STOs and ICOs in the near term?
Thai SEC approved ICO portal will have a range of features
The new law states that the SEC of Thailand will approve an unnamed ICO portal, which will list the licensed enterprises operating with crytocurrencies. The authorization of the first ICO portal in Thailand initiative was announced last year. However, the local authorities gave the green light to this project only now. As reported, the portal will:
- Conduct a comprehensive check on ICOs
- Confirm the source codes of “smart” contracts
- Carry out the procedures “Know Your Customer” (KYC)
The operator of the ICO portal is a foreign organization. The name of the company was not disclosed. In one of her interviews, Archari Supiroj the director of the Department of Financial Technologies at the SEC said that the launch of the portal is expected to go live shortly:
“The first official ICO portal in Thailand is being finalized for official approval by relevant government agencies, such as the Ministry of Commerce. The first ICO transaction will be available for a public offering in the near future in accordance with the royal decree on digital assets. ”
STO applications in Thailand are expected to start soon
In their current format, Thai law does not allow companies to digitize securities and the launch of STOs yet. Supiroj noted that the SEC has yet to finalize criteria for STO applications in Thailand. As soon as the commission presents a special set of rules to STO, startups will be able to submit an application for obtaining a license from the securities operator accordingly.
Companies interested in STO applications in Thailand, will have to apply for a license under the securites law. Similar like securities, the operations of STOs are supervised under the Securities and Exchange Act. Mr Ian Lim Teck Soon - Group Chief Underwriter of The Archipelago Group, a leading InsureTech Driven Ecosystem Insurance Company in Asia, commented:
“It’s really encouraging to see the progressive steps of the SEC of Thailand towards licensing ICO exchanges and preparing Thailand for future STO or digital assets offerings.
Since the 1997 Asian Financial Crisis, Thailand has not only positioned herself as the 2nd largest GDP and forex reserves holdings in the Asean community, now it’s ambitiously again re-engineering itself to be a new economic powerhouse with its ‘4.0’ digital innovation and value-based economy with emphasis on creativity, innovation and technology.
STOs can give the added intelligent capital for smart technology growth as the Thai GDP is more than 50% export based. This empowers new innovative Thai entrepreneurs to grow and flourish in the ‘4.0’ economy.
We see interesting opportunities to insure these digital assets and to even support STO digital offerings for investors’ protection through public offering digital securities insurance policies.
We remain invested in our ongoing InsureTech initiatives to support this digital ecosystem is areas of food, agriculture, farm to table traceability and increasing the health and wellness index of populations.”
Thai SEC attitude toward ICO changes
Last December, the Thai SEC following the US SEC example, announced its plans to consider loosening rules that form a “barrier” to ICOs, although the authority mentioned that “there will be caps on participation.” Tipsuda Thavaramara the general secretary of the Thai SEC then said:
“The proposed guideline is an attempt to find greater equilibrium in the regulatory process and reduce regulatory impediments while taking risk management and investor protection into account.”
According to the Archari Supiroj, the market of digital assets began to mature from the project and intangible ideas to ICOs, supported by physical assets. Supiroj also said that “in the future,” the SEC will issue criteria that will allow companies to label securities and other assets.
“The market regulator aims to create a level playing field for anyone who has a profound knowledge of digitization and tokenization, together with the ability to become intermediaries for STOs,” said Sippiroj.
The upcoming ICO portal is a result of the SEC efforts
The governmental approval of the cryptocurrency comes as a result of the efforts of Thailand's SEC. The financial authority managed to create a stable regulatory framework for startups who want to increase operating capital by selling digital tokens. Last May, the commission and the Ministry of Finance of Thailand amended the old securities bill to legalize the use of crypto active assets. In February 2019, the National Legislative Assembly of Thailand (NLA) amended the Securities and Exchange Act. The new amendment allows the SEC to decentralize depository securities centers. At the same time, it contributes to the non-documentary issue of securities.
The securities regulator shared that they interrogated “approximately” 7-8 portals. Eventually, the SEC board of directors approved one ICO portal, out of all.
SEC obtained the rights to license more depositary centers in Thailand.
Previously, only the Thai Securities Depository (TSD), owned by the Stock Exchange of Thailand, had the authority to act as the central depository of securities and bonds. Following the NLA contribution, the SEC obtained the rights to license more depositary centers in Thailand. After that, the commission said it now plans to issue rules for depository centers to support digitized securities. The finance authority also said that this would change the role of financial advisers and underwriters, in order to make them more accustomed to HDD.
Archari Suppiroj, director of the SEC Fintech, confirmed that the ICO portal - if approved by the government - will list its first ICO transaction for a public offer “in accordance with a royal decree on digital assets”.
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