Earlier, the SEC Board passed a resolution approving in principle the proposed regulations related to ICO Governance, which aim to ensure adequate and appropriate mechanisms for protecting investors, promote the ICO issuer’s awareness and responsibility over project management for the benefit of digital token holders, as well as enhance confidence in both fundraising and investment through ICOs. The SEC Board also approved in principle the proposed regulations related to ICO advertising. The SEC conducted a public hearing on the principles and draft regulations in February 2024. Most respondents agreed with the principles and the draft regulations. The SEC has therefore issued a notification specifying the amended regulations with the key points as follows:     

  1. Requirements regarding the check and balance mechanism to protect the rights of digital token holders. The ICO issuer must establish a check and balance mechanism and measures to prevent and manage conflicts of interest. Such mechanism and measures must be clearly outlined in the ICO filing. Additionally, specific significant matters require approval from the issuer's board of directors. This is to ensure that the board is committed and responsible for decision-making and the disclosure of information related to ICO projects;   

2. Token holder resolutions: To improve the regulations regarding token holder resolutions and relevant procedures, the SEC has issued a set of rules involving methods and reasons for seeking votes from token holders, the determination of votes, and the organization of token holder meetings, etc. The regulations are in line with similar measures imposed on real estate-backed tokens;     

  3. ICO advertisement: ICO advertisements are required to comply with additional regulations. The advertisements must refrain from enticing or pressuring investors into uncareful investment decisions. Moreover, they must not imply guaranteed returns and appropriate warnings about investment risks must be included. In case of using or referring to external information, the advertisements must ensure that the sources of such information are reliable and clearly specified. Advertisements must also align with other relevant requirements such as those for marketing promotions and deduction related to advertising expenses. Additionally, the issuer must ensure that third-party advertisers also comply with relevant regulations. Non-compliance with the advertisement requirements may lead the SEC to instruct the issuer to revise the advertisement content to ensure that investors receive accurate, comprehensive, factual and not misleading information.   

The notification specifying the amended regulations above* has been published in the Government Gazette and has become effective since 16 April 2024. 

Mr. Anak Yooyuen, SEC Deputy Secretary-General and Spokesperson, said: “These amendments aim to ensure that the ICO supervision incorporates mechanisms to adequately protect and safeguard the rights of investors, while also promoting the issuer’s awareness and accountability towards ICO projects and digital token holders. This in turn will enhance confidence in fundraising and investing through ICOs. Furthermore, appropriate advertising will ensure that investors receive necessary and useful information for making decisions on digital token investments." 

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Remark: 

* Notification of the Securities and Exchange Commission No. Kor Jor. 7/2567 Re: Public Offering of Digital Tokens (No. 10), dated 25 March 2024: https://publish.sec.or.th/nrs/10158s.pdf).