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Despite Bearish Market, Thailand Continues Backing Blockchain
Tuesday, December 4, as reported in Nikkei Asia Report, the Thai government has continued its support of progressive crypto regulation with a Security Token Offering (STO) planned in the first quarter of 2019. Satang Corporation, a Thai cryptocurrency exchange, plans to raise $9.9 million via an STO that has the backing of the Thai government.
The news comes as no surprise as Thailand has been doubling-down its efforts in blockchain technology adoption in a number of government services. At the start of November BNG reported on the Thai Government continuing to push blockchain solutions, detailing the Revenue Department’s plans to utilize distributed ledger technology (DLT) and machine learning to fight tax avoidance and fraud. This came after the June legalization of seven cryptocurrencies: Bitcoin, Ethereum, Bitcoin Cash, Ethereum Classic, Litecoin, Ripple and Stellar.
STO dubbed the new ICO by some, is a security token offering, another form of fundraising in which a companies offer a share of their profits from certain assets through dividend, as investors buy tokens, the value of their investment also fluctuates according to the performance of the company.
A push toward STOs have been in the hope to comply with financial regulation in different environments around the world. ICOs failed to comply with U.S. securities laws, STOs are guilty until proven innocent in China, the offerings remain illegal until regulation is authorized or they are made illegal once and for all.
Satang STO is funding the development of the Satang App, an e-wallet allowing consumers to easily make cryptocurrencies payments. The proceeds will also go toward setting up Satang Shops in tourist hotspots, where assumably users will be able to use their crypto-wallets.
Despite bearish crypto markets, with Bitcoin tumbling and alt-coins in toe, in addition to an insecure global regulatory environment, Satang’s plan has the support of Thailand’s government. Thai ministers have been keen to incorporate blockchain technologies into their ministry services, so a regulatory framework makes sense for the ecosystem.
The government has plans to incorporate a ‘highly-secure and flexible’ system of identification based on blockchain technology, according to Kirida Bhaopichitr, director for Thailand Development Research Institute Economic Intelligence Service, "The government will run the upcoming national digital ID platform on blockchain… It would allow the government to trace transactions, and would also reduce paperwork for ordinary people.”
With a sandbox environment with Thailand, the country could quickly become a hub for blockchain and cryptocurrency in the region. Bithumb, the second largest crypto exchange in South Korea announced it would be opening an exchange in Thailand due to the clear-cut regulatory framework in the country.