SET drafts advice for ICO investment
The Stock Exchange of Thailand is preparing guidelines for investment in initial coin offerings so that investors can evaluate ICOs and assess risk and return.
The guidelines are to be published on the SET website this month to let investors access complete information for their decision-making process before embarking on ICO investment, said SET president Kesara Manchusree.
The move comes as both listed and non-listed companies seek to raise funds via ICOs, Mrs Kesara said.
"We are worried about whether investors realise what they are investing in, so this is the reason for [publishing] the guidelines," she said. "However, the decision-making process is up to investors and we [at the SET] have no authority to obstruct them."
Some of the guideline questions ask investors whether they know what type of business they are investing in, what benefits are generated from the ICO investment scheme and what knowledge they have about the secondary market for ICO trade.
ICO transactions are similar to crowdfunding, whereby the issuer presents a business model to investors, but the key differences are that the raised funds are in the form of digital currencies using blockchain technology and the deals are enforced using smart contracts.
Mrs Kesara said ICOs are expected to become more popular among issuers because the fund-raising process and regulations are minimal compared with an initial public offering (IPO).
At present, however, most entrepreneurs in Thailand are familiar with IPOs and intend to raise funds from physical money, she said.
"The SET's guidelines are for investors to observe for the benefit of their decision-making process, but the bourse does not have any authority over their decisions," Mrs Kesara said. "We provide listed firms with training programmes for better performance, as well as long-term strength and sustainability."
Meanwhile, the Live trading platform, which caters to startups and small and medium-sized enterprises looking to raise funds, will focus on fund-raising from physical money, as some of these small firms may not need to raise capital via ICOs but may require other funding channels such as venture capital, Mrs Kesara said.
The Live trading platform has obtained a licence from the Securities and Exchange Commission to raise funds from crowdfunding by accredited investors. The platform is set to launch either in March or April this year.
Separately, the SET on Tuesday announced a combined net profit of 566 listed companies on the SET and the Market for Alternative Investment (MAI) of 990 billion baht, up 8.9% year-on-year.
Total net profit of SET-listed firms was 982 billion baht, up 9.1%, while total net profit for MAI-listed firms was 5 billion baht, down 13.5%.