Thailand gives crypto firms $1 billion in tax exemptions

Thailand will not charge companies raising capital through Initial Coin Offerings revenue and VAT as it looks for a piece of the Asian-driven bull run predicted by billionaire Cameron Winklevoss.

Members of Thailand’s cabinet ruled that companies that raise funds through “investment tokens” can also raise funds through bonds, Executive Committee member Rachada Dhnadirek told the Bangkok Post.

The Thai government is giving up over $1 billion in tax exemptions

Under the new ruling, the Thai government will lose about $1 billion in taxes from about $3.7 billion raised through initial coin offerings over the next two years. It has not indicated whether companies must provide disclosures to the Thai Securities and Exchange Commission before running ICOs.

Thailand has proven increasingly attractive to crypto firms, competing directly with Asian counterparts Hong Kong and Singapore.

According to The Bangkok Post, a report by tax software company Recap revealed that Thailand had acquired 57 crypto companies and had the second highest crypto ownership share. Ownership grew despite a government that had banned crypto payments citing financial stability risks.

According to Recap CEO Daniel Howitt, tightening of crypto regulations will determine whether Thailand can be an Asian crypto hub.

“Like many countries, Thailand is tightening the rules on crypto trading and digital asset advertising as well. With stricter regulations in place, it will be interesting to see whether this helps or hinders Bangkok’s place as a crypto hub in the coming months, he told the Bangkok Post.

Last year, the Securities and Exchange Commission promised to introduce greater investor protections by limiting celebrity advertising in the wake of the FTX collapse. It has yet to announce a new leader after the board reportedly refused to renew the term of the agency’s secretary general, whose contract will expire at the end of April 2023

The Cyber ​​Crime Investigation Bureau recently warned Thai citizens about cryptocurrency scams conducted through foreign exchanges.

Can Thailand compete with Hong Kong?

Meanwhile, Hong Kong is taking advantage of Singapore’s tightening regulation caused by several high-profile crypto fallout.

Last year, the Monetary Authority of Singapore released consultation documents to propose stricter regulation for customer funds held on crypto exchanges. These consultations are likely to be largely completed during the first half of 2023.

In addition, the city state wants to impose the banks’ framework for cyber risk on crypto platforms.

Singaporean authorities are still searching for Do Kwon, the co-founder of Singapore-based Terraform Labs, the company behind collapsed stablecoin TerraUSD.