The Thai Securities and Exchange Commission (SEC) has taken significant steps to regulate the cryptocurrency industry, aiming to enhance investor protection and minimize risks. During its meetings on September 1, 2022, December 1, 2022, and May 11, 2023, the SEC approved crucial measures to ensure transparency and security in the sector.
Firstly, effective from July 31, 2023, cryptocurrency trading center operators, cryptocurrency brokers, and traders will be required to disclose explicit risk warnings associated with trading digital currencies. The disclosure must prominently display a cautionary message stating, “Cryptocurrencies are high risk. Please thoroughly understand the risks involved as you may lose your entire investment.”
Additionally, investment suitability assessments and the allocation of appropriate investment proportions must be communicated to customers before they engage in the service. Prior consent and acknowledgment of the risks will be mandatory.
Secondly, commencing on August 30, 2023, digital asset business operators will be prohibited from providing deposit-taking and lending services, subject to specific exceptions outlined in the Notification. This includes the following provisions:
- Prohibition on accepting digital asset deposits and utilizing them for borrowing or investment purposes, along with returning profits to depositors.
- Prohibition on offering returns or incentives to depositors for making digital asset deposits, unless it aligns with SEC-approved sales promotion rules.
- Prohibition on advertising or persuading the general public to support deposit-taking and lending services, as defined in provisions, by the service provider or any other individuals.
Also Read: South Korea Implements Crypto Bill To Curb Unfair Trading
By enhancing disclosure requirements and restricting certain activities, the SEC strives to create a more secure environment for cryptocurrency trading in Thailand. The new rules have been published in the Royal Gazette and are now officially in effect.
