SEC clarifies its stance on listing and regulating utility tokens

SEC assistant secretary-general Jomkwan Kongsakul explained that utility tokens are for exchanging goods and services and the SEC would not focus on regulating tokens used for consumption.

Jomkwan said token-issuers are trying to get them listed in the market. However, there was a problem regarding their valuation. She said traders should have enough information on them regarding buying and selling price.

She said issuers have to reveal information on their tokens for the SEC to be able to regulate them. The SEC will be able to take action only if issuers conceal or reveal false information.

She assured that the SEC is not trying to block innovations and only wants traders to have enough information for consideration.

The SEC explained that it has exempted unlisted utility tokens, but utility tokens that would like to be listed have to apply for authorisation.

She said the best way to regulate information is through authorisation. Without authorisation, the SEC will not be able to regulate listed tokens.

The SEC would separate the authorisation process into two types.

• The fast track route will be available for simple utility tokens for consumption, as they should have available products to exchange and an expiry date. The value should be fixed and appropriate while the number should be limited because the tokens should not be used for speculation. Also, the tokens should be burnt after use so that they cannot be reused.
• The normal track process is longer and more expensive. For other more complicated tokens, the SEC added that it has tried to make the process inexpensive to help issuers save costs.

The next process will be a filing to reveal information before they are sold on ICO portals.

However, these regulations have not been finalised pending the SEC’s discussions with stakeholders in every related sector.