Thailand's SEC Breaks New Ground in 2024 With Crypto-Friendly Rules

The Securities and Exchange Commission (SEC) of Thailand is transitioning toward more crypto-friendly regulations, with an updated framework published earlier this month.

Thai SEC regulates cryptocurrencies under the Digital Asset Businesses Decree, focusing on areas like sales, trading and initial coin offerings (ICOs). Digital asset businesses operating in Thailand are required to obtain licenses and comply with the rules set forth by the SEC as outlined in this decree, the SEC has said.

The SEC's updated framework removes retail investors' limits for asset-backed tokens, creates new rules for custodians and gives the agency a larger role in monitoring digital asset business.

This month's removal of the investment limit for retail investors in digital tokens backed by real estate or infrastructure marks a significant shift. Previous rules had limited retail investors to 300,000 baht (approximately $8,400) per offering in asset-backed ICOs.

The change is expected to widen the market for a broader range of investors and support the nation’s digital asset market development.

The SEC update also requires the establishment of dedicated entities for custodial wallet management. However, these providers must be subsidiaries of publicly listed companies with a track record in secure securities storage.

The new regulations call for greater SEC involvement in monitoring the expansion of businesses in the digital asset sector. Firms looking to grow must first secure approval from the SEC, ensuring their expansion plans align with regulatory standards.

According to the Bangkok Post, Thailand’s SEC has chosen not to allow spot bitcoin exchange-traded funds (ETFs). This approach resembles South Korea’s, which also decided against allowing such ETFs in its domestic markets. A South Korean Financial Services Commission official told local media that “the government has consistently maintained the principle of prohibiting financial institutions from investing in virtual assets in order to stabilize the financial market and protect investors.”

This cautious approach comes after the market was significantly impacted due to the failure of Do Kwon's cryptocurrencies, Luna and TerraUSD, in Korea.

Binance Thailand's mid-January launch may also strengthen Thailand's crypto growth. Binance TH facilitates digital asset exchanges with Thai baht trading pairs, cooperates with local banks and collaborates with Binance Kazakhstan for brokerage services, all supervised by Thailand's SEC.

Read More: How Asia Drives the Next Crypto Bull Market