Thailand SEC Takes Tough Stance on Crypto Lending: New Regulations Loom

Cracking Down on Crypto: A Bold Move by the SEC

The Securities and Exchange Commission (SEC) of Thailand is set to unleash a wave of regulations aimed at crypto lending platforms. Following the turbulent crash of various platforms in the summer of 2022, the SEC is preparing to implement a ban on any digital asset depository services offered by these platforms.

Public Hearing and Feedback

As part of its approach, the SEC has initiated a public hearing, which began on September 15 and will continue until October 17. The public is invited to share opinions on the proposed regulations, a step that highlights the regulatory body’s push for transparency and community involvement in shaping the future of crypto in Thailand.

Key Changes Ahead

The SEC’s proposed ban specifically targets staking and lending services offered by digital asset business operators. By curbing these activities, the regulator aims to protect traders and the general public from the risks associated with transaction providers. According to the announcement, the main points of the ban are:

• Operators will not be allowed to accept deposits of digital assets with the promise of returns.
• Returns cannot be based on promotional budgets rather than the actual asset value.
• Advertising of lending and depositary services will face strict prohibition.

Lessons from the Summer of Turmoil

This significant shift in regulatory strategy stems from a summer filled with crises in the crypto space. High-profile cases like Celsius Network and Voyager Digital freezing their withdrawals and subsequently filing for bankruptcy served as a wake-up call. These incidents alarmed regulators and investors alike, leading to heightened scrutiny of the entire industry.

Thailand’s Own Zipmex Saga

In Thailand, the repercussions of the crypto lending meltdown were felt acutely with the case of Zipmex. After suspending withdrawals in July, citing uncontrollable circumstances, the SEC launched an investigation. The regulator accused Zipmex and its co-founder, Akalarp Yimwilai, of failing to comply with local laws regarding transparency on digital wallets and crypto transactions. This incident further fueled the need for regulatory changes.

New Advertising Standards Coming

Moreover, starting this October, the SEC will enforce stricter advertising regulations for cryptocurrency firms. Companies will be restricted to promoting their services through official channels, such as their websites. They will also need to disclose details related to their advertising expenses and any collaborations with social media influencers, ensuring all marketing efforts are accountable.

The Bigger Picture

These upcoming regulations indicate a broader shift towards responsible and sustainable crypto practices in Thailand. While the pendulum of regulation may swing in favor of increased oversight, the ultimate goal is to protect investors and foster a more stable market landscape.