Thailand takes steps to regulate ICO

nRunaway Comment: Blockchain Cryptocurrency ICO brings new start-up financing to the world. While this low-demand financing solution alleviates capital problems for innovative enterprises, it also poses some risks in terms of legitimacy. Therefore, the Thai Securities Regulatory Commission and the stock exchange to discuss the relevant regulatory direction and the specific implementation measures. Although the existing policy guidelines set a rigid limit on the amount of such financing, we should weigh the pros and cons, balance innovation development and risk prevention, and still need to strengthen the screening and classification of relevant activities and put forward more detailed requirements on ICO sponsoring agencies.n
nTranslation: Annie_Xun
To find a strategic balance, Thailand will further regulate ICO by broadening its existing guidelines. Discussions have begun between the agencies on the framework and soon public hearings will be organized. The ICO, launched by a locally incorporated company, will begin in March, raising $ 20 million to build a decentralized loan platform.n
The growth in other countries has prompted Thailand to take actionn
The Bangkok Post reported that the SEC and the Thai Securities and Exchange Commission are discussing a comprehensive regulatory framework that will cover ICO financing. Public hearings may be held in the near future. Once completed, a new set of regulations will be submitted to the SFC board for further discussion.n
Existing guidelines limit the maximum investment for retail investors, with up to $ 10,000 per ICO project and up to $ 95,000 per individual. With more information gathered from market participants, the SEC board will finalize the regulatory framework for tokens sales and related financial transactions. The first quarter of this year will be submitted to the board of directors for decision.n
nThe ICO issue requires a consistent domestic policy because it is a major issuen
nThe SEC Secretary-General, Rapee Sucharitakul, said that the rapid growth in ICO financing in many countries has prompted Thailand to decide to tackle the issue at the policy level. The SEC board will discuss tokens sales when it meets again.n
Rapee further commented on the need for such investment to gain regulatory support and warned investors and other participants may question their legitimacy if the ICO is not regulated. Thai officials underscored the rising popularity of ICO products among tech-savvy investors and start-ups. He said ICO’s popularity is because they can quickly raise money without submitting financial statements.n

One such company plans to run the ICO in March. J Ventures, a Jaymart subsidiary, will be the first SET listed company to sell its own digital currency to issue “JFin” tokens via token sales. The funds raised will be used to develop a decentralized loan platform that integrates blockchain technology. J Ventures hopes that the first phase of financing will raise about $ 21 million in local currency. Each token will be priced at 6.4 baht ($ 0.2) and the ICO issues 100 million tokens.n
Leave aside the initial concernsn
The SEC statement represents a subtle shift in regulators’ general positive attitude toward ICOs. Earlier a statement by the representative of the agency showed some reservations, but it seems that the initial concerns have been put on hold. Assistant Secretary-General Praoporn Senanarong once said that this new approach to financing “brings long-term disruptive risks to traditional financiers.”n
He issued a statement so that the ICO’s regulatory plan is the second quarter of next year. Praoporn also shared his concern that the sale of tokens may long replace the IPO. He believes this will subvert the traditional operations of asset managers, investment banks, investment advisors, exchanges and brokers.n
To take a “balanced ICO policy,” last year the SEC said it wanted “to strike a balance between supporting digital innovations and protecting investors against the risk of potential ICO fraud.” The agency warned ICO may become a fraud tool, but also mentioned the potential of tokens issued to meet the funding needs of start-ups. Earlier this month, Thai regulators have already started allowing bitcoin futures.n
Under the new ICO regulations, the amount of retail investment each company receives for each ICO project is limited to under 20 million baht (equivalent to approximately $ 640,000). The total amount of financing up to 40 million baht (about equal to 1.3 million US dollars).n
The SFC also plans to screen ICO projects through specialized portals. Companies will need to publish a white paper detailing project objectives, business plans and models, use of proceeds, legal risks, management and consulting information, and details of tokens.n

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