While the global digital asset market has been covered with FUD (Fear, Uncertainty and Doubt) news lately, NFT (Non-Fungible Token) products that are popular with collectors have not affected the market as a whole. Nowadays, NFT is used by artists or art creators around the world as they can earn more money from selling their works through traditional channels or formats, such as Tik Chiro, a famous singer in Thailand. in the past that brought lyrics The famous and legendary “Love Never Changes” is auctioned in the form of NFTs. Therefore, I would like to share some basic concepts of NFTs in a simple way as a guide for further study of such assets.
NFT is a type of digital asset that has its own characteristics, i.e. it cannot be substituted like other types of digital assets, so it can be tied to unique real-world works such as photographs, song lyrics, comic books, etc., and Set a selling price for the buyer or interested person of the work, allowing the owner of the NFT tokens tied to the work or product, and the buyer can resell the NFT online at a higher price.
Due to the fact that NFT properties are currently being used in connection with artwork. The Act B.E. 2537 will be used to protect that work from being directly imitated, duplicated or modified, but may not include NFT depending on the conditions of that sale. But in practice, the NFT buyer cannot know whether the work tied to the NFT is copyrighted or the rights of the NFT issuer or not, which can be seen. From cases where creators plagiarize their own works to reissue NFTs for sale in various secondary markets.
Even though the Royal Decree on Digital Asset Business B.E. Digital tokens for investment and digital tokens for benefits that can be used immediately or have to wait for rights in the future
Therefore, in the case of NFTs, the characteristics or properties of each coin must be considered whether it meets the definition of digital assets under Thai law or not. If there is a specific right to acquire goods, services or any other rights other than the right to acquire the NFT itself, it may fall into the definition of Digital Utility Tokens or Utility Tokens that may be subject to regulation by The royal decree
But if the NFT has a property nature, that is, the NFT cannot be separated from the property tied to that NFT and no additional rights are assigned, such as digital images and NFTs will be transferred together when sold. Such NFTs may not be digital assets regulated by Royal Decree on Digital Asset Business B.E. 2561
And since NFTs are classified as digital assets, exchanges or networks where NFTs are traded and exchanged must be licensed for digital asset business from the Minister of Finance. However, at present, Thailand does not have an NFT exchange or NFT Marketplace allowed to operate. In addition, currently licensed digital asset trading centers cannot trade NFTs according to the Securities and Exchange Commission’s announcement No. KorThor. 18/2564.
Therefore, it is worth considering that NFT technology is more special than cryptocurrency. The digital token that we commonly know It can be used for other businesses besides just selling and exchanging works of art, such as using NFTs instead of land title deeds or government documents. In what direction will it be developed because the laws of Thailand are still unclear or allow developers to use such special features to create new innovations in the future?
Mr. Prungsak Chaochart, Lawyer, Executive Partner Aber Law Offices Group
Professional Arbitrator for Digital Assets of the Thai Arbitration Institute (THAC)
and Suchada Yamsin, legal advisor Aber Group
