Thai SEC softens stance on ICOs in bid to attract larger retail investment

Thailand’s securities watchdog has divulged plans to soften its stance on retail investments for initial coin offerings (ICO) in the country, according to an official announcement.

The country’s Securities and Exchange Commission (SEC) had previously imposed an investment limit of THB300,000 (US$8,725~) on retail investors seeking to invest in real estate-backed or infra-backed ICOs. Experts believe that the new proposal could open the floodgates for retail investors to become major players in the ecosystem.

“The revision of the regulation is aimed at enhancing effective monitoring of digital asset operations and reducing risks that might affect investors, digital asset operators, and the market,” according to the securities regulator.

The SEC is seeking public comments on its planned removal of the investment limits with consultations expected to run until April 27. A clause in the announcement warned that investors will be exposed to increased risks following the lifting of the investment limits.

Per the announcement, Thai’s SEC is also seeking public opinion on allowing custodial wallet providers to offer services to digital asset firms that are linked through majority shareholding. The SEC noted that it will be prepared to issue licenses if the firm has the expertise to store customer assets and are “able to comply with the independence criteria as specified by the SEC.”

Thailand’s SEC proposed that registered virtual asset service providers in the country can explore other businesses apart from digital assets. The securities watchdog noted that firms interested in pivoting from their original object clause should seek the consent of the SEC before undertaking operations.

The announcement noted that digital asset service providers may bear the brunt of additional charges in compliance with the proposed ICO regulators.

Thai SEC’s history of tightening the screws

Following the implosions that rocked the virtual currency space in 2022, Thailand’s SEC began tightening the screws around the ecosystem under the mantra of protecting investors. The first casualty of the increased regulatory interest was a blanket ban on staking and lending activities while virtual currency advertisements came under intense scrutiny.

Industry operators offering custody services were mandated to establish a contingency plan in the event of security breaches, in addition to the requirement to set up a digital wallet management system in line with the SEC’s guidelines.

“An audit of system security is also required as well as digital forensic investigation in case of any event affecting the security of systems related to digital asset custody, which could cause significant impacts on clients’ assets.” said the SEC.

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