Thailand’s securities watchdog today (Monday) issued new rules that ban cryptocurrency firms from offering crypto lending Crypto Lending The process of lending cryptocurrency assets with an accrued interest rate and due date is known as crypto lending. The process of crypto lending often occurs through cryptocurrency exchanges or online lending platforms to connect borrowers to lenders. Lenders of crypto lending are comprised of institutional lenders, like hedge funds and asset managers, individual participants, or entities seeking to accrue interest. On the opposite end of the spectrum, borrowers of crypto lending include market The process of lending cryptocurrency assets with an accrued interest rate and due date is known as crypto lending. The process of crypto lending often occurs through cryptocurrency exchanges or online lending platforms to connect borrowers to lenders. Lenders of crypto lending are comprised of institutional lenders, like hedge funds and asset managers, individual participants, or entities seeking to accrue interest. On the opposite end of the spectrum, borrowers of crypto lending include market Read this Term services that provide returns to investors for their deposits. The rules also demand that digital asset operators from July 31, 2023, start warning their customers against the risks of cryptocurrency trading.

Thailand Focuses on Investor Protection

According to the Securities and Exchange Commission (SEC), crypto exchange operators must display this message (translated from Thai to English): “Cryptocurrencies carry a high level of risk. Please study and understand the risks of cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term thoroughly. You may lose the entire amount of your investment."

These rules also mandate crypto business operators to ensure that their customers consent to acknowledge the risks involved in cryptocurrency trading. In addition, crypto firms will assess their customers for investment suitability and prescribe ‘appropriate investment proportions’. The watchdog said the rules are targeted at boosting “investor protection against the risks of such services.”

The SEC’s new rules on crypto lending services and warning disclosure follow resolutions made on the issues in December and September 2022, respectively. In May this year, the markets supervisor further revised the resolution on risk warning disclosure.

More Crypto Rules in Thailand

With the new rules, Thailand’s securities regulator continues its strict oversight of the local cryptocurrency industry. In September last year, the financial markets supervisor introduced strict rules on crypto promotion and advertising. It mandated crypto companies to display investment risks, provide a balanced view between risks and returns, and submit information on their advertisements projects.

In early 2022, the watchdog also announced a ban on crypto as a means of payment, which was effective from April. However, it permitted Thai citizens to invest and trade digital assets.

Recently, authorities in Thailand proposed enforcing a 15% capital gain tax on crypto traders and miners, exempting exchanges. However, the government jettisoned the plan after facing strong opposition against the move. The SEC is also considering lifting its restriction on retail investment in initial coin offerings.

Moreover, in 2021, the SEC shelved its proposed plan to impose a minimum annual income of 1 million baht (around $33,000 at the time) on crypto investors. However, it mandated physical ID checks of crypto investors and license registration for crypto fund managers.

Despite the strict regulatory environment, Thailand citizens continue to flock massively to the cryptocurrency industry. According to Chainalysis, the Southeast Asian country ranked 8th in terms of global crypto adoption in 2022.

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