ICO

Any entity seeking to conduct an ICO must first file an application for approval with the SEC.

But instead of directly screening applications from individual ICO projects, the SEC will first evaluate filings submitted by so-called “ICO portals,” which are online marketplaces where potential ICO organizers can operate their token sales. The SEC said those approved ICO portals will be responsible for screening projects, after which the applications of those selected projects will then be considered. (Note, these ICO portals have not yet been approved, but some are expected to receive approval soon. See this news ) also at the bottom of this section.)

The SEC said ICO portal applicants must be registered businesses in Thailand with a minimum registered capital of 5 million baht, or $150,000. These portals must have adequate resources to evaluate an ICO issuer’s business plan, project structure, technical capacity, and source code, according to officials.

In addition, the SEC said only Thai baht and seven cryptocurrencies can be accepted in token sales, including bitcoin, bitcoin cash, ethereum, ethereum classic, litecoin, XRP, and lumens. (Taken from CoinDesk here.) (Read CryptoVest for more.)

Rapee Sucharitakul, the Secretary General of the SEC, remarked that about fifty ICO projects have already stepped up to get certification and raise funds although it is still uncertain as to how many of them will receive the requisite credentials to do so. He further noted that about 60 percent of enthusiastic ICO portals had already filed their license applications with the SEC. Besides these firms, about 20 companies had also sought authorization for businesses serving as exchanges for virtual assets. The Secretary General said that the license applications were undergoing evaluation and review for application. He also noted that most firms willing to start digital asset exchanges were quite happy with the level of trading in virtual assets and cryptocurrencies. Usually, the process of authorization takes up to 5 months to be completed. Upon receiving an application, the SEC forwards the request to the Finance Ministry within the stipulated period of 90 days. After this, the Ministry must take a maximum of 60 days to approve or reject the licensing request. The criteria for a company seeking license are that it should be Thailand-based, should have a registered paid-up capital and have a stable financial condition. (From BTCwires

Post-ICO

• After the completion of an offering, issuers of Digital Tokens have ongoing duties to disclose information to investors and the public. They are required to prepare and submit reports to the SEC Office with regard to their financial condition, business operations or any other information which may affect the rights and interest of Digital Token holders, investment decision-making or the price or value of Digital Tokens.

• The SEC is empowered to exempt the offering of certain types of Digital Tokens from provisions of the Royal Decree relating to the offering of Digital Tokens or from the duty of filing of the registration statement and the draft prospectus. The rationale is to not impose a burden on certain Digital Tokens which have minimal impact on the financial system or the general public. For instance, Digital Tokens are used in the ordinary course of trading goods or services.

• In undertaking digital asset businesses, the approved operators shall comply with the rules, conditions and procedures as specified in the notification of the SEC; for instance, having adequate sources of capital covering business operation and other several risks, having reliable operating systems and data security systems, maintaining records of assets belonging individual clients, segregating client assets from their own assets, and conducting Know Your Customer (KYC) and Customer Due Diligence (CDD).

• Where any digital asset business is in a situation where its financial condition or operation may cause damage to the public or is in violation of relevant regulations, the SEC is empowered to order such business to rectify the problem or to temporarily suspend the business operation wholly or partially. In addition, if the digital asset business still fails to comply or has repeated the violations, the Minister of Finance, upon recommendation of the SEC, is empowered to revoke business approval.

The Prevention of the Exploitation of Digital Assets to Facilitate Illegal Transactions

The Royal Decree imposes that the issuers of Digital Tokens who are willing to accept Cryptocurrencies in the offering process or the operators of digital asset businesses who are willing to accept Cryptocurrencies from the counterparties in any transaction shall only accept Cryptocurrencies obtained from or deposited with operators of digital asset businesses regulated under the Royal Decree. The rationale is to preserve the integrity of markets by ensuring that cryptocurrencies being transacted come from traceable sources.

Additionally, the Royal Decree imposes that digital asset businesses and ICO portals are considered “Financial Institution” under the Anti-Money Laundering Act, in order to prevent the exploitation of digital assets as a channel for money laundering.

The Maintenance of Financial and Economic Stability 

Where transactions, business operations or other activities related to digital assets may significantly affect the stability of national financial system or economy, the Minister of Finance, upon approval of the Cabinet, is empowered to prohibit digital asset businesses from engaging in any particular digital-asset-related activity, or to suspend their operations wholly or partially.

The Prevention of Unfair Trading Practices

The Royal Decree imposes offences of unfair trading in relation to the purchase, sale or exchange of digital assets taking place in a Digital Asset Exchange in a similar manner to the corresponding provisions in the Securities and Exchange Act, such as false dissemination, insider trading, front running and market manipulation.

This is to ensure that secondary markets for digital assets are fair, transparent and efficient, market integrity is preserved and investors are protected. (Taken from the SEC here.)

Sources

ICO

• (Taken from CoinDesk here.)
• (Read CryptoVest for more.)
• (From BTCwires

Post-ICO

• (Taken from the SEC here.)