Thai SEC Proposes Ban on Crypto Platforms Offering Depository Services

Thai SEC Proposes Ban on Crypto Platforms Offering Depository Services

The Thai Securities and Exchange Commission (SEC) is taking significant steps to regulate the cryptocurrency sector following the collapse of several crypto lending platforms in mid-2022. In a recent announcement, the SEC revealed plans to prohibit crypto platforms from offering or supporting digital asset depository services.

Regulatory Crackdown on Crypto Lending Platforms

The proposed measures aim to address the risks associated with crypto lending and depository services, which have come under scrutiny after the high-profile failures of major platforms last summer. The SEC has initiated a public hearing to gather feedback on the proposed regulations, with the consultation period set to run until October 17.

Ban on Depository Services for Crypto Platforms

Under the new rules, crypto platforms would be restricted from providing or facilitating digital asset storage services. This move is part of a broader effort to enhance investor protection and maintain financial stability in Thailand's cryptocurrency market.

Rationale Behind the Ban

The SEC's decision reflects growing concerns over the lack of oversight in the crypto lending space. By prohibiting depository services, regulators hope to reduce the risk of significant losses for investors in the event of platform failures.

Public Consultation and Next Steps

The SEC is inviting stakeholders, including industry participants and the general public, to share their views on the proposed ban. The feedback collected during this period will likely influence the final shape of the regulations. Once implemented, the rules could significantly impact the operations of crypto platforms in Thailand.

This move underscores the Thai regulator's commitment to tightening oversight of the cryptocurrency sector, ensuring greater transparency and security for investors.