By Michael Scott
Thailand announced plans to revise its crypto regulation prompted by the disastrous FTX collapse. Like other countries that portrayed an appetite for increased oversight of the crypto space, Thailand has demonstrated its intention to impose tighter guidelines for the sector.
Necessity of Revising Crypto Rules
The countries Securities and Exchange Commission (SEC) revealed in a statement released on December 13 revealed plans to issue stringent guidelines targeting a crackdown on questionable corporate governance of digital assets firms.
The SEC representatives have justified the decision through reference to apparent failure in internal management practices that made collapse inevitable for FTX, Three Arrows Capital and Celsius Network. The SEC representatives have indicated that tiger regulations could have safeguarded investors in TerraUSD and Zipmex who witnessed their digital wealth evaporate helplessly.
The statement captured in the Bangkok Post expressed concern about the increased utilization of predatory crypto advertisements. Notably, SEC questioned the affinity for celebrity endorsement in conveying messages considered to mislead audiences to embrace high-risk crypto investments. Consequently, the regulator considers it timely to tame the vulnerability bad crypto actors could leverage to exploit Thais.
Priority Areas Targeted by Tighter Crypto Rules
Besides investor protection, SEC has identified taming conflicts of interest, ending predatory advertisement and averting cybersecurity as priority areas. The regulator affirmed its readiness to take on bad actors by establishing a working committee comprising private stakeholders and SEC officials to weigh possible amendments to the existing crypto regulations.
The message conveyed in the SEC statement echoes previous attempts to crack the whip on predatory crypto advertisements. Earlier in September, SEC mandated all crypto players to include warnings on the risk inherent in digital assets.
SEC would days later initiate a public hearing on its desire to ban crypto platforms from offering depository services. SEC considered that providers of digital asset depository subjected the public to the aggravated risk of losing their digital wealth. Consequently, the public hearing that began in September targeted safeguarding traders via the bans targeting crypto lending and staking.
The motivation portrayed by the Thai regulator arose from the adverse experience when local crypto platform Zipmex suffered the bankruptcy wave. Subsequent investigations by the SEC indicated Zipmex management, alongside co-founder Akalarp Yimwilai repeatedly violated Thai laws.