The Central Bank of Thailand has planned a review of cryptocurrency laws to empower the central bank. Reports suggest that the new regulation changes will include the Central Bank among its members.
Finance Minister Arkhom Termpittayapaisith spoke in an interview about the planned changes. Furthermore, the government will also include strict regulations on cryptocurrency platforms that also offer other tokens.
The U.S. Securities and Exchange Commission is currently the only regulatory agency that has the exclusive mandate to oversee the industry under the regulations approved in 2018, and has now been asked to take the lead in the audit.
This move was on hold, as tightening of the rules was called for when Thai authorities were criticized for not being timely enough when the Zipmex cryptocurrency exchange suspended withdrawals.
Tougher cryptocurrency laws to ensure investor protection
Thailand's finance minister also said in the interview that the tightening of regulations is not meant to curb the growth of the sector. Thailand does not even want to limit the innovations and technology of the sector. These standards aim to ensure greater investor protection.
Recently, the Zipmex cryptocurrency exchange lifted its block of transactions and even filed a moratorium in Singapore to protect creditors from any legal action. This will help Zipmex find some time to raise funds.
The decision to involve the Bank of Thailand was also due to other factors, due to the collapse that caused traders to lose almost 2 trillion dollars. Cryptocurrency lenders have also been greatly affected by the cryptocurrency winter.
Big names like Celsius, Three Arrows Capital and Zipmex have left many investors struggling with their funds. According to some reports, the number of active trading accounts dropped from 700.000 to 230.000 in one year.
Thailand has adopted cryptocurrencies consistently despite stricter regulation
Thailand has had problems with cryptocurrency exchanges in the past. Thailand was quick to issue trade licenses, however. The country has reportedly approved four other cryptocurrency operators in the past week. Currently, with the new approvals, the total number of licenses for digital asset operators has reached 21 units. This number also includes three fund managers, nine exchanges and nine brokers.
The need to update the legislation also arose from the fact that, at the moment, the Central Bank has not prepared a regulatory framework, apart from the notification that cryptocurrencies are not a legal method of payment for goods and services.
This framework lacks clarity and is not sufficient to regulate the sector, which therefore needs to be reviewed. Many digital asset companies have also tried to fake artificial trading volumes, the SEC fined Bitkub for doing the same. For this reason it is imperative that the Central Bank of Thailand increases investor protection through strict rules.
