SEC bans trade in gimmick tokens and NFTs

SEC bans trade in gimmick tokens and NFTs

Thai regulator looks to rein in speculation in assets with 'no clear objectives or substance'

A television camera is seen next to the non-fungible token (NFT) “CryptoPunk #7523”, a series of 10,000 unique pixel-art characters made by Larva Labs in 2017, during a media preview for an auction at Sotheby’s in New York on June 4. (Reuters Photo)
A television camera is seen next to the non-fungible token (NFT) “CryptoPunk #7523”, a series of 10,000 unique pixel-art characters made by Larva Labs in 2017, during a media preview for an auction at Sotheby’s in New York on June 4. (Reuters Photo)

The Thai Securities and Exchange Commission has banned digital asset exchanges from trading meme- or fan-based tokens, non-fungible tokens and exchange-issued tokens.

The regulation is expected to affect so-called meme tokens like Dogecoin, which originated as a joke cryptocurrency and has become an object of speculative frenzy, as well as tokenised arts and collectibles. It was enacted on Friday with immediate effect, although it’s not retroactive, according to a statement from the regulator.

The move came amid reports that SET-listed Jay Mart was making plans to launch the country’s first non-fungible tokens (NFTs) linked to nine local stars and celebrities.

The move reportedly was meant to promote the ecosystem of Jay Mart’s digital token JFin coins, increasing demand for a variety of digital tokens in the market.

NFTs, which certify a digital asset to be unique and not interchangeable, are tracked on blockchains to provide the owner with a proof of ownership. They have become a popular way to sell digital artworks, in some cases for millions of dollars. 

Ruenvadee Suwanmongkol, the SEC secretary-general, said exchanges are banned from trading utility tokens or cryptocurrencies that have one or any of the following characteristics:

  • Having no clear objectives or substance, and whose prices are dictated by social media trends, or meme-based tokens;
  • Tokenised by the fame of influencers, or fan-based tokens;
  • A digital creation to declare ownership or grant rights in an object or specific right; it is unique and not interchangeable with digital tokens of the same category and type at the equal amount, or non-fungible tokens;
  • Digital tokens that are utilised in a blockchain transaction and issued by digital asset exchanges or related persons.

The exchanges are required to comply and revise their rules within 30 days, the regulator said. Failure to do so could result in the delisting of the digital token, it said.


Do you like the content of this article?
COMMENT (44)

Mosaics to convey work, life of King Rama V

Wat Ratchabophit will have 12 mosaic pictures made that will feature the life and work of King Rama V and the temple's history.

05:28

4 held as cops close down investor scam

Police have raided a condominium in Samut Prakan and arrested four suspects allegedly running an investment scam.

05:19

Pet food exports continue to flourish

Thailand's pet food exports are thriving, driven by the pandemic, which caused people to spend more time at home and change their behaviour regarding raising pets as family members.

04:40