During the first quarter of 2022, Thailand’s Securities and Exchange Commission (SEC) announced a series of notifications aiming to strengthen the regulatory regime for digital assets while safeguarding investors’ interests. The updated rules and conditions apply to digital asset business operators licensed by the SEC.
The key features of the new notifications, which took effect in March and April 2022, are summarized below.
Custody of customers’ assets (effective March 1, 2022)
As custodians of their customers’ assets, digital asset business operators must:
Privacy coin services (effective April 1, 2022)
Digital asset business operators are prohibited from providing privacy coin services that can conceal (or allow the concealing of) specific transactional information, such as data about the transferor, the transferee, and the transfer amount.
Digital asset business operators that provided privacy coin services to customers before the effective date of these new regulations may continue to provide such services, but they must arrange for their customers to disclose at least the required transactional information or agree not to engage in information concealment.
Digital assets as a means of payment (effective April 1, 2022)
Digital asset business operators are prohibited from using digital assets as a means of payment and must not provide any services or undertake any activities that encourage or promote the use of digital assets to pay for goods or services. This includes:
Business operators must take action (e.g., warnings, account suspension or termination, etc.) against customers who fail to comply with service terms and conditions.
Providing customers with activity reports (effective March 30, 2022)
The SEC now requires digital asset operators to provide their customers with a report, within one business day of a transaction, containing specific information about the customers’ digital asset trading, exchanging, and investment activity. Operators must retain the disclosed information for at least 18 months.
Although the requirement came into effect on March 30, there is an initial implementation stage until April 30, 2022, during which operators only need to provide reports to their customers within a reasonable period of time upon request. The reporting requirement will be fully implemented from May 1, 2022, onward.
For more information on the latest SEC rules and regulations for digital assets, or on any aspect of digital asset business or cryptocurrency in Thailand, please contact Kobkit Thienpreecha at [email protected], Onunya Chanpen at [email protected], Sorawit Partomtanasarn at [email protected], or Napassorn Lertussavavivat at [email protected].