- These safeguards are necessary to protect ordinary investors and traders as per SEC.
- The most recent event follows the liquidity issues that several exchanges had this year.
The Securities and Exchange Commission (SEC) of Thailand is launching additional procedures concerning the operations of crypto operators as the cryptocurrency industry develops.
According to reports, the Thai SEC is aiming to limit or prevent crypto operators from providing digital asset depository services and from paying out profits on customers’ deposited cryptocurrencies that are then lent out or reinvested.
Stringent Set of Rules
According to the Thai SEC, these safeguards are necessary to protect ordinary investors and traders. The most recent event follows the liquidity issues that several exchanges have had thus far this year. Additionally, several cryptocurrency lenders who had promised greater interest rates to depositors were forced to declare bankruptcy once the market crashed. The Thai SEC has proposed that it should be illegal for cryptocurrency businesses to accept deposits of digital assets and then use those assets to borrow against or invest in other digital assets in order to pay the depositors.
No public relations or solicitation efforts or other actions that might lead to deposits or loans are allowed. It would be illegal to forbid digital company owners to take deposits of digital assets and pay such deposits back to their customers.
After crypto exchange Zipmex had liquidity issues in July 2022, the Thai SEC acted swiftly. At the time, Zipmex, which was widely used in Southeast Asian nations, froze user accounts and prevented them from making or receiving any transactions.
Since then, the Thai SEC has enquired into the public risk of loss. Zipmex users who were affected were also able to provide comments via an online forum. The Zipmex withdrawals for Thai clients were promptly restored, but this has not eased the SEC’s concerns. Similarly, the Thai SEC reported the cryptocurrency exchange Zipmex to the authorities last week.
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