Thailand's SEC Unveils DLT Platform for Digital Securities Trading

The Securities and Exchange Commission (SEC) of Thailand is set to launch a distributed ledger technology (DLT)-based platform for digital securities trading, aiming to modernize the country's bond and securities markets. The new system seeks to address current inefficiencies, such as the 7 to 14-day delay in bond trading, by digitalizing the entire trading process.

The SEC has already approved four digital token projects, with two more under review, focusing on green tokens and investment-based initiatives. The regulator plans to allow securities companies to engage in digital token trading, leveraging their large investor bases to expand market participation.

The new trading system will operate on a flexible infrastructure model, allowing companies with existing DLT systems to develop independent chains, provided they maintain interoperability with the broader network. For firms without existing infrastructure, the SEC will offer access to its public chain at reasonable costs.

A key feature of the platform is its comprehensive approach to digitalization, handling all aspects of securities trading, including settlement, trading execution, investor registration, and return payments. The system will support both new electronic securities and tokenized traditional securities, enabling features like fractional trading and real-time settlement.

To support market analysis and investment decisions, the SEC is developing an Open API data platform that will provide information about all listed companies, improving market transparency and helping investors make more informed choices.

The initiative aligns with Thailand's broader efforts to embrace digital finance, even as the country maintains restrictions on cryptocurrency payments. The government is testing cryptocurrency payments for foreign tourists in Phuket as part of a pilot program. Recent reports suggest that Thai officials are considering the possibility of issuing a government bond-backed stablecoin, though no official confirmation has been made. The country's central bank has also partnered with the Hong Kong Monetary Authority to explore cross-border tokenization projects.

The SEC emphasizes that the new system will maintain competitive market conditions through its open infrastructure approach. A standardized framework for data connectivity will ensure smooth operation across different platforms within the digital securities ecosystem. Development of the shared ledger system that will connect various trading chains is nearing completion, according to SEC officials.

The implementation timeline includes plans for rolling out new regulations to facilitate electronic securities issuance and online debenture purchases. These rules will help establish the legal framework for the new digital trading environment.