Thailand is now the second country after Japan to implement cryptocurrency regulations, essentially recognizing digital currencies as an asset. Thankfully, Thailand, like Japan, has taken a more progressive approach towards cryptocurrencies and Blockchain technology as a whole, believing regulation and structure is the key to managing the nascent industry, rather than banning it outright.
About the New Crypto Regulations
The new Thai cryptocurrency regulations came in to effect from Sunday, May 13 by royal decree. The regulations consist of a 100-section law that defines cryptocurrencies as digital assets as well as digital tokens, thereby bringing them under the jurisdiction of the Thai Securities and Exchange Commission (SEC).
The Thai Finance Minister, Mr. Apisak Tantivorawong, has been quoted as saying that the new laws are not meant to prohibit or ban cryptocurrencies, or even ICOs (Initial Coin Offerings). The idea is to regulate them so that money laundering and fraud can be prevented and consumer interests are safeguarded.
This royal decree has been through multiple iterations since the first draft was introduced in March this year. In this time, the Thai cryptocurrency market was beset with uncertainty, as the Thai central bank prohibited domestic banks from trading or allowing investments in cryptos due to a lack of regulations. Additionally, the Thai Digital Asset Exchange (TDAX) had to temporarily stop cryptocurrency trading and registration.
Now that the new law is in effect, the cryptocurrency market can resume normalcy.
Key Aspects of the New Regulations
With the establishment of the new cryptocurrency regulations, all sellers of digital tokens or assets must register with the Thai SEC within the next 90 days.
If they fail to do so within the stipulated time, sellers trading in digital tokens and assets that have not been authorized by the SEC will face stiff penalties. These penalties include being fined no more than two times the value of the digital transaction, or a minimum of 500,000 baht (about $15,700). Such offenders could also look at the possibility of jail time for up to 2 years.
All domestic cryptocurrency exchanges as well as independent dealers and brokers will be required to register with the SEC.
Now that the first set of laws have been put in place, the Finance Ministry will work with the SEC to create organic laws that will require all digital currency transactions, even from digital currency exchanges, dealers as well as brokers, be registered with the SEC by royal decree.