The initial coin offering (ICO) sector is one that has taken off by storm in the past year and a half. However, a lot of authorities across the world were not expecting or prepared for this sudden explosion in growth.
Therefore, they have been playing catch up ever since. This means that there is now the development of various rules and regulations that will clear up a lot of unknown variables that are part of the sector.
With more regulation, there will be more legitimacy entering into the sector. The Securities and Exchange Commission (SEC) in Thailand have been working hard on their set of official guidelines for a number of months. One of the highlights of their new set of rules is the decision that fiat cannot be traded for ICO tokens
What are the details about this decision?
This set of guidelines have been expected for a while now, with the SEC in Thailand now ready to have the cryptocurrency market in the country properly regulated. Their goal is to have all service providers in the sector to be compliant with these rules by the close of June.
This set of organic laws applies to both the transacting and trading of cryptocurrency in the nation. Those companies in the space also need to obtain a new license if they wish to continue with their operations.
The guidelines are certainly interesting. There is not going to be any official trading of ICO tokens. Instead, they can be traded for 7 particular cryptocurrencies, which include Bitcoin, Bitcoin Cash, Litecoin and XRP.
All companies engaged in this type of trading will need to obtain an operating license to do so. The authorities do expect at least 5 different exchanges to apply for this license in the next couple of weeks, but no information as to which ones they expected to do so would be.
The most surprising aspect of these guidelines is that ICO tokens are not going to be allowed to be traded with fiat currency. Of course, these are the first version of the guidelines so this may change in the future, parties will have to wait and see if this is the case.
If a party is caught selling tokens without having any form of authorisation, they will receive a fine. To get approval for any of the relevant licenses, you will have to get in touch with the Thai Finance Ministry. If you do not do so, there is a jail sentence in place of up to two years as a potential penalty.