The Securities and Exchange Commission (SEC) of Thailand is set to introduce a debt instrument trading system powered by distributed ledger technology (DLT) to encourage securities firms to engage in digital token trading while enhancing regulatory oversight in the digital era.
Jomkwan Kongsakul, Deputy Secretary-General of the SEC, noted that token investments are gaining momentum.
The regulator has approved four digital token projects and is currently reviewing two more, with a focus on green tokens and investment-based initiatives.
Additionally, five other parties have consulted with the SEC on potential fundraising solutions, including soft power tokens and green token innovations.
In the near future, securities companies in Thailand will be allowed to trade digital tokens to leverage their extensive investor bases, according to Jomkwan.
“The SEC is leveraging technology to enhance efficiency in the capital market by promoting an electronic securities ecosystem,”
she said.
“In the future, new regulations will be introduced to facilitate the issuance of electronic securities and online purchases of debentures.”
Currently, purchasing bonds in the primary market takes between 7-14 days before they can be traded in the secondary market.
Investors also face challenges such as limited access to certain products, high costs, and illiquidity. Meanwhile, issuers deal with manual data processing, which leads to delays and errors.
The use of advanced technology is expected to streamline these processes, making them faster and more accurate.
The SEC aims to fully digitalise bond trading for both the primary and secondary markets, covering settlement, trading, investor registration, and return payments.
Competition will remain open, Jomkwan said, as firms with their own DLT infrastructure can develop independent chains, provided they adhere to a standardised framework ensuring interoperability.
Companies without their own chains can use the SEC’s public chain at a reasonable cost.
“In the future, there may be multiple chains for trade. Trading through DLT on all systems is connected by a shared ledger, which is expected to be completed soon,”
Jomkwan Kongsakul said.
Two types of securities issuance will emerge: digital-native products created directly on DLT and traditional products converted into digital form.
The latter will function as twin products that can be traded within the DLT system, enabling fractional trading, lower costs, higher liquidity, real-time transactions, and reduced settlement issues.
Additionally, the SEC is developing the SEC Open API data platform, providing access to information on listed companies to help investors make more informed decisions.
Featured image credit: edited from freepik
