This month, we get to know a bit more about OmiseGO’s compliance and regulations advisor Tipsuda Thavaramara –who we first featured in our AMA bonus question on regulations. With over 20 years of experience in the field of regulations and compliance in Thailand and South East Asia, let’s hear what she has to say about OmiseGO, fintech’s high-speed and regulations in blockchain.
Q: Could you tell us a little bit more about yourself, your background with the Securities and Exchange Commission (SEC), Thailand and how all this has brought you to OmiseGO?
I was at the SEC for 26 years. My last position was Deputy Secretary-General in charge of policy, markets and intermediaries, and investment management. My most important contributions at the SEC have always been in capital market development. I spent the first ten years at the SEC creating new institutions and legal infrastructure such as the Bond Dealers Club (now Thai Bond Market Association), enabling rules for short selling, securities lending, derivatives law, and the non-voting depository receipt (NVDR) scheme as a solution to the problems related to foreign ownership. The subsequent ten years, I worked on several areas of market liberalization such as brokerage commission, licensing, overseas investment, and cross-border offerings.
Then the policy issues in the last four years shifted to disruptive technology and what regulators needed to do to allow the industry to transform in response to change. I led the team that drafted the digital asset law in 2018 and the securities law amendment in 2019 that would allow digital securities issuance through a central securities depository.
I first got to know OmiseGO in 2017 when the company did an ICO (initial coin offering). The activity did not fall under the SEC’s jurisdiction but I invited Donnie and Vansa to come educate my team at the SEC anyway. We kept in touch and in 2018 Jun and Donnie introduced us to Vitalik Buterin. This was at a time when the SEC was in the middle of exploring regulations in blockchain and regulatory options for crypto assets, so that was very helpful. How did all this bring me to OmiseGO? I would like to think that the OmiseGO team feels they can benefit from my policy making and regulatory experience as they move into a regulated market space. For me, joining OmiseGO gives me a fresh experience in an exciting new area.
Q: Can you tell us more about your role here at OmiseGO?
At OmiseGO, I am the compliance and regulations advisor. I help the OmiseGO business development team understand the relevant regulations in blockchain, as well as principles, standards, expectations, and issues of concerns. This ensures they design products and services that comply with regulations.
Q: You’ve worked with the Thai SEC for over 20 years, what do you see as the biggest changes that technology has brought about in the way individuals, businesses and even countries are doing business?
In my earlier years at the SEC, the securities industry in Thailand operated in a somewhat protected environment. There were fixed commissions and restrictions in the number of licenses and the types of eligible products. The brokerage business needed a large troop of marketing staff. So, competition then meant a race to cut commission rates while trying to steal your competitor’s salespeople.
Today, technology allows businesses to have greater and faster access to data and market insight, to offer customer-centric solutions, to reduce reliance on people and to improve the ability to scale. All kinds of functions that can be offered “as-a-service” help lower the barrier to entry for new players. The game has changed almost entirely.
Q: A lot of the technology we deal with today wasn’t even available maybe five years ago, so how are regulatory bodies coping with the increasingly digitalized world?
Regulators are always under pressure to promote an efficient and inclusive financial market, while ensuring market integrity, consumer protections and public confidence. The challenges that come with an increasingly digitalized world are manyfold: the borderless nature of internet transactions, the shift from humans to algorithms, the increasing decentralization of markets, the blurring of lines of product or activity classification, and the speed at which all this is happening. Regulators are not used to the idea of not being in control, so the most common response given time constraints would be to try to fit what they see with existing rules, even though those may not always fit.
Even if they accept that what they see needs a new type of treatment, it is difficult to step out of the existing boundary, and some may end up with the new rule being an offshoot or clone of the existing rule.
At the same time regulators will cooperate and share information and experience, and a new standard might soon emerge. They will also rely more on education and information transparency as a tool for investor protection, rather than relying primarily on themselves to grant permission for everything.
Q: What do you think are the biggest hurdles blockchain and crypto projects face when vying for mainstream adoption and how do you think they can overcome them?
I think one big hurdle is that consumers, businesses, and regulators are not entirely comfortable with the idea of not knowing who to hold accountable should something go wrong. Therefore we see all kinds of intermediaries being reintroduced into what is supposed to be a scheme without intermediaries. Crypto projects need to identify where and how they can address this trust and accountability question. During the earlier phases of mainstream adoption, permissioned or consortium blockchains will probably find it easier to break into the mass market.
I see OmiseGO succeeding in this area through properly complying with regulations in blockchain at a network level. This move will allow for institutional players to enter the space –triggering the next stage towards mass adoption.
Q: Where do you see blockchain and crypto heading in the next five years in Thailand and Asia?
In the next five years, I think there will be a lot of progress in mainstream adoption, but mostly with permissioned blockchains. We should see more traditional assets becoming tokenized, allowing peer-to-peer trading and real time settlement. And that will change the future of exchanges and clearinghouses.
Q: What role do you think OmiseGO could fill when it comes to regulations and the blockchain ecosystem?
With more and more mainstream adoption of blockchain and crypto technology, OmiseGO’s financial services will likely fall within regulations in blockchain eventually. If its products and services are deemed to be not only compliant but also at the forefront of trust mechanism design, that would be a strategic advantage.
The question of trust and accountability will remain central to the future of blockchain, and to the objective and design of regulations. OmiseGO is adding value here through cheaper transactions, a fast and scalable network, and through proper regulatory compliance – as I’ve mentioned above.
Originally published in the OmiseGO August 2019 Newsletter