Digital currencies are flourishing in Thailand today. Despite strict regulations, crypto accounts have grown by almost 300% over the past six months. This was reported by the Thai Securities and Exchange Commission (SEC).
Interest in digital coins in Thailand is now at its peak. However, the rules that exchanges and companies must adhere to remain fairly strict. Thailand’s cryptocurrency trading market is one of the most regulated in the world. For example, one of the largest local cryptocurrency trading platforms, Bitkub, has faced lengthy service outages. After a series of malfunctions, the exchange was closed by regulators.
One of the significant developments in the regulation of the Thai cryptocurrency market happened recently. The Securities and Exchange Commission has announced its intention to introduce a minimum annual return of 1 million baht (about $ 33,000) for cryptocurrency investments .
The reaction of the crypto community in Thailand to the SEC decision
The news was received negatively by the local crypto community and received a flurry of criticism. This is due to the fact that all potential investors with low and middle income will be automatically excluded from the digital currency market. In this regard, the SEC had to clarify the statement within a few days after its announcement.
In its explanation, the SEC noted that the published draft law is only a means of measuring investor sentiment. Thai SEC Secretary General Ruenwadi Suwanmongkol also said:
“I proposed criteria that many felt were too stringent to encourage people to express their opinion on this matter and did not intend to say that these are exact requirements that will be implemented.”
The CEO of Thai cryptocurrency exchange ERX stressed that the community understands the fact that the SEC’s intentions are not negative. They are aimed at creating a secure mechanism that could help protect investors from any unjustified market risks:
“We understand the good intentions of the SEC. However, many stakeholders in the digital asset market and the majority of the population disagree with the plan. From an ERX perspective, this safeguard should not focus on minimum income; instead, it should take the form of improved operator disclosure and investor education. ”
Some analysts believe that the SEC’s decision went against the very foundations of a free market economy and freedom of choice. After all, Thai residents with low or middle incomes will not be able to access a potentially lucrative investment industry.
On the other hand, potential investors who do not have the required level of education in the field of cryptocurrencies and financial education, without understanding the risks of such investments, may find themselves in the zone of this very risk without proper regulation by the authorities. This method may turn out to be the only correct solution in the issue of protecting the interests of society.
Thailand’s digital asset industry has grown significantly in recent months. According to the SEC, the number of cryptocurrency trading accounts in the county has grown from 160,000 at the end of 2020 to 470,000 as of February 1. In addition, about 50% of these accounts are held by investors under the age of 30
For now, the Thai Securities and Exchange Commission is deviating from its original go-to-market requirements scheme. Negotiations are underway with local representatives of cryptocurrency exchanges and platforms, the final solution has not yet been found. Hearings on this issue will take place on March 24, and the final results will be announced on March 27.