[2018-10-05] ICOshock - How Thailand effectively killed the local ICO market

[ICOshock]

Thailand is a beautiful country that is developing at a consistent rate. Unfortunately, the regulation is not beneficent for those who trade or use digital assets. This is real pity an otherwise open society (certainly for tourists) with a lot of bright minds has taken such draconian measures.

First off, by trading digital assets in Thailand, you are bound to pay 20% withholding tax, 15% capital gains tax and 7% sales tax on every transaction.

How Thailand effectively killed the ICO market

On July 16 this year, the Thai SEC released a set of guidelines for ICO’s in the country. To be able to launch an ICO, you would have to adhere to the following guidelines:

1. Establish Local company with 51% minimum local ownership, capital paid of 5 million baht.

2. Apply for an ICO license through a yet to be formed entity called the ICO hub.

3. Prove capital paid up of 100 million baht.

4. Apply with the Thai SEC for permission, which may or may not be granted even after the above cost!

If you went through the process and were lucky enough to get your company granted to hold an ICO, there are additional things that hinder success.

1. No direct capital contributions are allowed in neither fiat or crypto, all contributions must run through a licensed exchange which is subject to the above tax.

3. Retail investors are limited. Institutional investors are allowed, but all are subject to the above tax structure which efficiently hinders the majority from participating.

Thailand, on the other hand, has an incredibly vibrant Blockchain and digital assets community, filled with super smart, innovative people and solutions. It’s a shame when regulators are without vision.

Source: https://icoshock.com/thailand-ico-regulation/

[maarx]

Thailand is a beautiful country that is developing at a consistent rate. Unfortunately, the regulation is not beneficent for those who trade or use digital assets. This is real pity an otherwise open society (certainly for tourists) with a lot of bright minds has taken such draconian measures.

First off, by trading digital assets in Thailand, you are bound to pay 20% withholding tax, 15% capital gains tax and 7% sales tax on every transaction.

How Thailand effectively killed the ICO market

On July 16 this year, the Thai SEC released a set of guidelines for ICO’s in the country. To be able to launch an ICO, you would have to adhere to the following guidelines:

1. Establish Local company with 51% minimum local ownership, capital paid of 5 million baht.

2. Apply for an ICO license through a yet to be formed entity called the ICO hub.

3. Prove capital paid up of 100 million baht.

4. Apply with the Thai SEC for permission, which may or may not be granted even after the above cost!

If you went through the process and were lucky enough to get your company granted to hold an ICO, there are additional things that hinder success.

1. No direct capital contributions are allowed in neither fiat or crypto, all contributions must run through a licensed exchange which is subject to the above tax.

3. Retail investors are limited. Institutional investors are allowed, but all are subject to the above tax structure which efficiently hinders the majority from participating.

Thailand, on the other hand, has an incredibly vibrant Blockchain and digital assets community, filled with super smart, innovative people and solutions. It’s a shame when regulators are without vision.

Source: https://icoshock.com/thailand-ico-regulation/

With your above statement, I would strongly say that Thai is much protective, vibrant and keen on legal ICOs getting into their market where their citizens do not get cheated. But they are very eager to have crypto's potential growth enhancing their country and citizen's economy standard. I understand that rules imposed are not easy for those who begin ICOs. Their rules would bring in best ICOs although they need to get through many rules.

[senin]

Approximately the same rules for ICO are being prepared now in Russia. There you also need to first have a certain amount in the bank, all calculations, including fundraising during the ICO, must pass through the bank and a special state structure will control the targeted use of funds collected during the ICO even after it ends. The rules are tough, but this will completely eliminate the possibility of fraud. There it will be impossible to run away with the collected funds, since they will be in the bank under the control of state bodies.

[veleten]

Approximately the same rules for ICO are being prepared now in Russia. There you also need to first have a certain amount in the bank, all calculations, including fundraising during the ICO, must pass through the bank and a special state structure will control the targeted use of funds collected during the ICO even after it ends. The rules are tough, but this will completely eliminate the possibility of fraud. There it will be impossible to run away with the collected funds, since they will be in the bank under the control of state bodies.

yup although it may seem that the rules in Thailand or Russia have killed the ICO market
in reality it will get rid of all the useless , no-idea-behind semi scam ICO's that are only being created to run away with the money
in this scenario it is much harder to run away with the money, at least you got to invest something upfront before creating an ICO
thus, yeah this will pave the way to the legitimate ICOs (although the whole tokens/ico idea has been dragged into dirt so much that soon I will treat ICOs same way I treat HYIPs)
won't do too much to protect the investors from the countries ,but at least if you see its a Thai ICO you can be more or less sure it is not your 100% scammy bs tokens without a substance

[ICOshock]

Approximately the same rules for ICO are being prepared now in Russia. There you also need to first have a certain amount in the bank, all calculations, including fundraising during the ICO, must pass through the bank and a special state structure will control the targeted use of funds collected during the ICO even after it ends. The rules are tough, but this will completely eliminate the possibility of fraud. There it will be impossible to run away with the collected funds, since they will be in the bank under the control of state bodies.

yup although it may seem that the rules in Thailand or Russia have killed the ICO market
in reality it will get rid of all the useless , no-idea-behind semi scam ICO's that are only being created to run away with the money
in this scenario it is much harder to run away with the money, at least you got to invest something upfront before creating an ICO
thus, yeah this will pave the way to the legitimate ICOs (although the whole tokens/ico idea has been dragged into dirt so much that soon I will treat ICOs same way I treat HYIPs)
won't do too much to protect the investors from the countries ,but at least if you see its a Thai ICO you can be more or less sure it is not your 100% scammy bs tokens without a substance

Definitely some valid points you got there, with all the scam ICO's going around, it is totally understandable that governments want to control the industry by setting a regulatory standard.

The problem though is that the strict regulation makes it pointless to do an ICO in the country, and thereby efficiently killing the market. With the current regulation, many of the benefits of ICO projects vanishes.

[Kprawn]

They do not want to kill it, they want to milk it dry with double taxation and also stupid regulations. The ICO scene are full of

innovation and they basically ignored that and just wanted to place a barrier to entry to get into it. Countries with regulations

like this are smothering innovation and possible job opportunities for millions of people. (Ok, may be not millions)  In any

way, they will suffer the most when these people start leaving the country to operate in countries where ICO are allowed

without all these stupid regulations. 

[buwaytress]

I'm always reluctant to view these types of "draconian" measures as "bad" for crypto, especially when it comes to ICOs. In the first place, the ICO proliferation wasn't exactly good for the market, just take a look at >2k tokens floating about, inflating capitalisation without offering any value other than their speculatory activities. Innovation hasn't exactly been the hallmark of ICOs; the significant development and deployment of tech and applications are still firmly in the arena of open source and non-ICO related projects.

Conducive to ICO doesn't automatically mean conducive for blockchain, and vice versa. Like veleten, I actually think these rules are good for weeding out the noise. Those that are serious about developing something useful will comply, or anyway have no such commercial interests that would qualify them for all these tax obligations. Those who've been focused on profit and running ICOs with impunity will be stopped in their tracks.

If anything, Thailand has killed the scam and vapourware economy. Good riddance.

[ICOshock]

I'm always reluctant to view these types of "draconian" measures as "bad" for crypto, especially when it comes to ICOs. In the first place, the ICO proliferation wasn't exactly good for the market, just take a look at >2k tokens floating about, inflating capitalization without offering any value other than their speculatory activities. Innovation hasn't exactly been the hallmark of ICOs; the significant development and deployment of tech and applications are still firmly in the arena of open source and non-ICO related projects.

Conducive to ICO doesn't automatically mean conducive for blockchain, and vice versa. Like veleten, I actually think these rules are good for weeding out the noise. Those that are serious about developing something useful will comply, or anyway have no such commercial interests that would qualify them for all these tax obligations. Those who've been focused on profit and running ICOs with impunity will be stopped in their tracks.

If anything, Thailand has killed the scam and vapourware economy. Good riddance.

I strongly disagree. This kind of regulation leaves ICO crowdfunding as an option that is only viable for multi-million businesses, in addition to removing the decentralized features.

With this kind of regulation, the benefits of doing an ICO is gone, and the company might just as well do an IPO.