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Update Regarding Digital Currency Issues in Thailand

Transcript of the above video:

For those who keep up with this channel, we have discussed crypto currencies, so called digital currencies, Bitcoin etc., at some length in various videos on this channel. We took a bit of hiatus from discussing that specific issue mostly because there have been some recent holidays here in Thailand and also because I kind of wanted to wait around until there was a fair amount of meat to really get my teeth into in a video on this topic and here we are.

In a recent article in the Bangkok Post, it's entitled "Crypto Fans Urge Capital Gains Rethink, 17th April 2018. Quoting directly: "Crypto enthusiasts and issuers of initial coin offerings have asked the Finance Ministry to delay or waive the capital gain tax to be imposed on ICOs and crypto currency trading aiming to assist the fundraising process for start-ups domestically." Quoting further: "Operators of crypto currency e-wallet service have to apply for a license from the Securities and Exchange Commission if the wallet doesn't use Baht for crypto currency trading. Other e-wallet companies operating services in Baht are required to have a minimum registered capital of 200 million Baht and must apply for a license from the Bank of Thailand". So a couple of things that are worth noting there, most interestingly to me, other e-wallet companies operating services in Baht are required to have a minimum registered capital of 200 million and apply for a license from  the Bank of Thailand. Up to this point that is the most clarified I've seen on the overall issue of e-wallets in the Kingdom. That being said, that may not be where this finally sort of shakes out but it is of note and clearly licensing for non-currency, for non-Baht denominated wallets, is of interest but what I find interesting is the entire reason they're bringing up this, that varies advocates are bringing up this notion of trying to get rid of the capital gains tax associated with crypto currencies is to try and create Thailand as a platform for crypto currencies, exchanges, initial coin offerings etc. I am not going to get into what I think personally as to what I think personally to whether it is right or wrong to have a capital gains tax on the crypto currencies although I can certainly see the argument that by imposing a tax, it creates a sort of relative disadvantage for Thailand compared to other jurisdictions which have basically, you know in some jurisdictions, no tax regime with respect to crypto currency whatsoever.

It is my personal opinion, notwithstanding issues associated with the taxing of crypto currency, especially with respect to initial coin offerings I think the relevant regulators are more interested in coming up with a workable framework in order to properly enforce  laws and discourage things like fraud in this sort of ecosystem. That really seems to me to be more their priority.  That being said government’s priority is often times revenue generation so it is not a shock to me that they have proposed a capital gains tax and it wouldn't be a shock to me if they actually imposed one. But that being said, how this actually plays out remains to be seen but a couple of key things to keep in mind with respect to some of the key developments, there does appear to be a stronger sort of more coherent regulatory framework is coming into focus and we are also seeing a tax enforcement framework coming into focus. Exactly what this is going to look like sort of at the end of all the wrangling remains to be seen but we will keep you updated as things progress.