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The regulators at Thailand’s Securities and Exchange Commission (SEC) are exploring possible obstacles for digital asset businesses in a prior crypto royal decree.
According to Secretary General of the Thai SEC, Ruenvadee Suwanmongkol, the regulators must be flexible for rules and regulations to be applicable in line with the digital market environment. The amendments are expected to take place by next year as the SEC aims to cater the growth of virtual assets and protect investors from avoidable risks.
Suwanmongkol further added that laws should not be outdated in reference to the situation and that they should serve market requirements for these emerging virtual asset products. She said that the SEC needs to explore any potential hindrances in order to compete in the global market.
The royal decree, effective since May 14 of last year, categorizes four secondary trade intermediaries that include virtual exchanges, brokerage firms, token platform service providers or initial coin offering portals and dealers. It covers digital currencies, token and other electronic units for data meeting SEC specifics.
Suwanmongkol states that many companies are interested in becoming digital token developers, but virtual tokens and initial coin offering should exist on ICO portal companies for the public, all three of which are required to start their operations only after SEC approval.
Former SEC Secretary General, Rapee Sucharitakul, stated last year that the legislation aimed to protect investors from any threat of fraud and dishonesty and other misdemeanors such as money laundering and illicit use of virtual assets in illegal transactions, while simultaneously maintaining regulations to carry out legitimate use of crypto assets.
Only Five Crypto Exchanges Were Approved
Currently, only five companies have been granted digital asset exchange license by Thailand’s SEC. Three companies have been granted authorized licenses for digital asset brokers by the commission, and only one company has been granted digital asset dealer license by SEC, Coin TH Co Ltd.
According to the royal decree, unauthorized sellers of virtual tokens will be receiving a fine of twice the value of electronic transaction, or at least a minimum of 500,000 baht (a little over $16,500). The punishment could also include serving up to two years in jail.
Additionally, investors who engage in virtual asset-related trade will pay a value-added tax of 7% and a withholding tax of 15% on capital profits and returns on the investments. VAT is not required for retail investors if they trade virtual assets through cryptocurrency exchanges, and those who do not make capital gains will only pay for VAT.