THAILAND Law and Practice Contributed by: Wongsakrit Khajangson, Panupan Udomsuvannakul, Koraphot Jirachocksubsin and Pitchaya Roongroajsataporn, Chandler Mori Hamada
10.4 Regulation of “Issuers” of Blockchain Assets
markets in line with global digital and FinTech advancements. 10.2 Local Regulators’ Approach to Blockchain Even though the BOT and the Office of the SEC are very cautious about the sale of blockchain- based digital assets and cryptocurrency, they and other local regulators are very positive about wider uses of blockchain technology and are keen on utilising it. 10.3 Classification of Blockchain Assets The Digital Assets Decree, which governs block - chain assets under the defined term “digital assets” , separates digital assets into cryptocur - rency and digital tokens. “Cryptocurrency” is defined as an electronic data unit built on an electronic system or net - work that is created as a medium of exchange for the acquisition of goods, services, or other rights, including the exchange between digital assets. “digital token” is defined as an electronic data unit built on an electronic system or network to specify a person’s right to invest in any project or business or acquire specific goods or ser - vices. Digital tokens are further separated into two types: investment tokens and utility tokens. Regulating Digital Assets Currently, the SEC regulates digital assets based on the activities of the operators, with some differences depending on the types of digital assets (eg, there are some differences in require - ments for underlying assets that are in the form of real estate and infrastructure) under the Digital Assets Decree.
The closest concept to “issuers of blockchain assets” are the “issuers” of digital assets under the Digital Assets Decree. The issuer of an initial coin offering (ICO) must be a limited company or a public limited company. Similar to as discussed in 6.4 Listing Stand- ards , prior to the offering, the issuer must obtain approval from the Office of the SEC and submit registration statements and draft prospectuses as indicated in the relevant SEC notification. The offer for the sale of digital assets is permissible only after the registration statements and the draft prospectuses have been approved by the SEC. The offer for sale must be made via the system provider, the so-called ICO portal, which has been approved by the SEC. Regarding a potential regulatory structure change, see Regulating Digital Assets in 10.3 Classification of Blockchain Assets . 10.5 Regulation of Blockchain Asset Trading Platforms The closest concept to a blockchain asset trad - ing platform under Thai law is “digital asset exchange” under the Digital Assets Decree. “digital asset exchange” is defined as any cen - tre or network established for purchasing, sell - ing or exchanging digital assets by means of the matching or finding of parties or the provision of a system or facilities whereby those intending to purchase, sell or exchange digital assets may reach agreements or may be matched. Digital asset exchange operators must apply for permission. The MOF would grant this upon the SEC’s recommendation. The appointment of directors and executives of the operator must also be in accordance with the relevant notifica -
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