Thailand's SEC Issues Regulations Limiting Use of Digital Assets
for Payments
The Bank of Thailand (BOT), the Thai Securities and Exchange Commission (SEC), and the Ministry of Finance (MOF) will regulate the use of digital assets.
The three
regulators have reviewed the benefits and risks of crypto assets and "deem
it necessary to regulate the usage of digital assets as a means of payment for
goods and services, to avert potential impacts on the country’s financial
stability and economic system."
Thailand's regulators have decided to restrict the usage of
cryptocurrency as a payment method. The government considers the country's
current payment system to be efficient, and cryptos would only bring hazards to
the financial system, economy, people, and enterprises.
Thailand's financial regulators are taking steps to restrict the
use of cryptocurrencies in the payment of goods and services, citing a variety
of financial and economic risks. The Securities and Exchange Commission (SEC)
proposed new guidelines to make it more difficult for digital asset providers
to offer and support such services.
The action follows conversations with the Bank of Thailand (BOT)
about the benefits and hazards of digital assets, during which the two
institutions agreed on the necessity for laws to protect the nation's financial
system and economy while also preventing risks to individuals and businesses.
These dangers included price volatility, personal data leakage, and money
laundering.
The Thai Securities and Exchange Commission (SEC), which regulates
crypto businesses, have indicated that it has a policy to promote the growth of
digital asset businesses while simultaneously protecting consumers. It will
keep a watch on sector providers in the future to make sure they are not
accepting digital assets as a form of payment. At the same time, the new rules
are not supposed to prevent anyone from trading or investing in cryptocurrency.
According to the regulator:
‘All types of digital asset business operators must not provide
services or act in a manner that encourages or promotes the payment of goods
and services with digital assets, such as advertising, soliciting, or
presenting them as being available to pay for goods or services to merchants.’
Companies should not develop systems and methods to assist crypto
payments, or open wallets for that reason, according to the commission. If a crypto
platform discovers that its users are using trading accounts to make payments,
it must notify them of the misuse and, if needed, take action, such as
temporarily suspending or terminating the services.
The new restrictions will take effect on April 1, 2022, according
to the SEC. Companies that provide services that are affected by the new limits
will have 30 days to comply with the rules, according to the body's statement.
In January, the SEC and the BOT announced their plans to regulate
cryptocurrency payments in the country. The regulation change comes despite
prior initiatives in Thailand, a popular tourist destination, to make such
payments easier. The tourism industry recently met with the central bank to
discuss alternate payment options, such as cryptocurrency, for Russian visitors
whose nation has been sanctioned as a result of its invasion of Ukraine.
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