Thailand Details Cryptocurrency and ICO Regulation

Thai watchdog has legalized the trade of Bitcoin, Ethereum, Bitcoin Cash, Ethereum Classic, Litecoin, Ripple, and Stellar

Thailand’s Securities and Exchange Commission (SEC) has released a comprehensive framework for the regulation of the country’s cryptocurrency market. The new rules include a list of approved cryptocurrencies, Initial Coin Offering (ICO) restrictions, fees and licensing requirements for market operators.

The laws were approved at the regulator’s June 7 meeting and are expected to come into effect later this month, local media has reported. This announcement follows two royal decrees published on May 14, addressing all crypto-related issues and giving the Thai SEC the responsibility of regulating the crypto space in the country.

Approved Cryptocurrencies

The SEC will allow seven cryptocurrencies to be used for Initial Coin Offerings (ICOs) and trading pairs within the country. These are Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH), Ethereum Classic (ETC), Litecoin (LTC), Ripple (XRP), and Stellar (XLM). The coins were chosen based on their consensus credibility and liquidity, the Bangkok Post reported.

ICO Restrictions

In May, the Thai government banned ICOs while waiving the previously planned 7% VAT (value added tax) on cryptocurrency transactions. The new ICO regulations reverse the ban while stipulating strict conditions that must be met by future ICOs.

According to the SEC decree, companies looking to conduct an ICO must indicate the token type and the investment information. The regulator also requires issuers to oversee their offerings for at least one year while having a minimum base capital of THB 5 million (USD 157 000). Investments are capped at THB 300 000 for individual retail investors per ICO project, while institutional investors can invest an unlimited amount in any ICO offering in the country.

Licensing Requirements and Fees

Under the new laws, all market participants, including digital asset exchanges, brokers, dealers, and ICO issuers, must register with the SEC within 90 days of the effective date and be approved by the finance ministry.

In order for businesses to receive a license, they must also pay a fee of THB 5 million. Digital asset dealers will be charged THB 2 million, and brokerage firms THB 2.5 million. The annual fee for digital exchanges is 0.002% of the trading volume, with a minimum fee capped at THB 500 000 and maximum at THB 20 million. Brokerage firms have smaller fees at 0.001% of the trading volume with a minimum fee of THB 250 000 and a maximum of THB 5 million.

The SEC expects around 10 firms to apply for licenses, with around half of them comprising digital asset exchanges and the other half being cryptocurrency dealers and brokers. The deadline for license applications is August 14.