Thailand SEC Issues Regulations For Crypto Exchanges & ICOs

The Securities and Exchange Commission of Thailand has provided the guidelines for trading cryptocurrencies. All cryptocurrency exchanges and related business must adhere to the rules stipulated by the regulator by the end of June.

The rules framed by the monitoring agency are intended to govern both trading and investments in cryptocurrencies in Thailand. Furthermore, all businesses which handle cryptocurrencies in some form or the other must apply for a new license from the regulator.

The SEC, Thailand permits the official trading of ICOs. However, the tokens are allowed to be exchanged only for seven cryptocurrencies. They are Bitcoin (BTC), Bitcoin Cash (BCH), XRP (Ripple), Ethereum (ETH), Stellar (XLM), and Litecoin (LTC). The seven currencies were chosen based on consensus credibility and liquidity.

The SEC believes that 5-10 exchanges will apply for a license in the forthcoming weeks. Either dealers or brokerage firms which are actively involved in cryptocurrency business is expected to apply for a license. Despite the relaxations, Thai regulator is determined to preserve the safeguard its domestic currency. The regulator has clearly ruled out the possibility of trading cryptos against fiat currencies in the country.

The last date to apply for a license is August 14, which represents a 90 day deadline from the date of announcement by the SEC. A sum of 5 million Baht (~$157,000) is required as an upfront fee and only companies which are registered in Thailand are allowed to apply.

All licensed cryptocurrency exchanges must pay an annual fee of 0.002% on the total trading volume. Brokerage firms must pay an annual fee of 0.001% on the annual trading volume. A minimum fee of 500,000 Baht and 250,000 Baht must be paid by a cryptocurrency exchange and brokerage firm, respectively. The maximum fee is limited to 20 million Baht and 5 million Baht.

As far as ICOs are concerned the SEC has stated that each ICO should clearly mention the type of tokens being issued, along with complete investment information. There is no ceiling on the number of tokens which can be granted to institutional and ultra-high net worth investors. However, for an individual investor, an investment cap of 300,000 Baht is applicable and it should not constitute more than 70% of the total value of offered tokens. The guidelines may become the reference source to regulators in other countries.