The Thai government has made a major move to approve tokenized security issuance and digital assets trading using blockchain technology.
Thailand’s National Legislative Assembly (NLA) approved an amendment of the Securities and Exchange Act, which will allow tokenized securities issuance in the country.
The Securities and Exchange Commission of Thailand (SEC) has been leading the effort to amend the Act, which is expected to be implemented later this year. In the meantime, the Thai SEC is set to announce additional rules and regulations for digital tokens and assets over the next few months.
SEC Deputy Secretary-General Tipsuda Thavaramara stated that Thai lawmakers have demonstrated their intent to open new opportunities for the development of tokenization platforms in the future, which will contribute to the country’s digital ecosystem.
Local newspaper Bangkok Post reported that, previously, only the Thailand Securities Depository Co., Ltd., a subsidiary of the Stock Exchange of Thailand, was permitted to serve as a scripless securities depository.
Currently, the cryptocurrency industry in Thailand is regulated by the 2018 Royal Decree on Digital Asset Businesses.
SEC Director of Corporate Affairs Pariya Techamuanvivit disclosed that the regulator will decide whether security token offerings (STOs) fall under the Royal Decree or the newly amended Securities and Exchange Act, in order to clarify the legal ramifications of trading securities on crypto platforms.
The Royal Decree states that should characteristics of the financial instrument match the definition of securities under the Act, the financial instrument — though issued in the form of a digital token — would be regulated under the Act.
Additionally, the Ministry of Finance has granted licenses to four cryptocurrency businesses, while rejecting applications from two companies in January. The Thai SEC has revealed that it also plans to apply for a digital asset trading license from the ministry.
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