Thailand is taking a rather proactive approach towards regulating the field of cryptocurrencies. In search of legislative balance, the country passed a new law which is putting an end to a long-standing debate.
CURRENCY OR SECURITY? WHY NOT BOTH?
Skipping the debate that regulators across the world are seemingly unable to settle on, Thailand has passed an entirely new law defining digital assets as both currencies and securities — depending on their intended purpose.
Under the Digital Asset Business Decree, as the law is dubbed, regulators define two types of digital assets. “Cryptocurrencies” are used as a medium for exchanging goods, while “digital tokens” are defined as rights to take part in an investment or to receive specific goods.
The country has also set forth rules for governing the digital asset activities that entities are allowed to engage in. These include “(1) a digital asset trading center/exchange; (2) digital asset brokerage; (3) digital asset trading; and (4) other activities related to digital assets as specified by the Minister of Finance.”
Thailand has also mandated cryptocurrency exchanges be registered and licensed with the Ministry of Finance.
According to Archari Suppiroj, director of Thailand’s SEC, the move stems from the intention of the commission to strike a regulatory balance between those who are against cryptocurrencies and those who use them for gambling purposes. She also noted that regulations have to be approached and instituted carefully as a too-strict approach may drive investors away.
ICOS ARE ALSO UNDER THE RADAR
The country is also taking measurable steps towards resolving issues surrounding Initial Coin Offerings (ICOs). The country has required ICOs to obtain permission from the Ministry of Finance and has also formalized the process in a manner which is comparable to issuing an equity or debt.
The decree also stipulated that ICO portals need to do what’s necessary in order to oversee their offerings for at least year while maintaining 5 million baht (roughly around $157,000) of underlying capital.