Thailand’s Securities and Exchange Commission (SEC) is holding another public hearing to get public opinion on banning the provision of cryptocurrency staking and lending services to customers.
Watchdog is cracking down on digital asset custody services in the aftermath of the crypto lending platform crash it experienced earlier last year, according to a press release. It warns that DeFi platforms are facing collapse.
Therefore, Thailand’s SEC stepped in to maximize protection for local investors and minimize risks for the public when interacting with the sector. It explains that these unexplored and unknown technologies are putting consumers at risk.
The SEC is proposing to ban crypto businesses from “taking deposits of digital assets and then borrowing those digital assets to invest in them to pay depositors.” deposit or lending services; Digital operators are prohibited from accepting digital assets and paying depositors for returns. ”
“Under the SEC’s policy, digital asset operators are required to protect digital asset investors and the general public in the event of service interruptions or financial problems that may occur on an ongoing or ongoing basis. In order to prevent the potential for damage, it is not permitted to provide or support deposit receiving and lending services on a concurrent basis between service providers, as is the case with foreign counterparts these days. The draft is expected to further clarify the scope of supervision of digital asset businesses as they are not under state supervision,” the statement said.
Prior to the recent crisis, the use case presented by major players was that lending trends shifted toward relying on digital assets to support business operations, rather than betting solely on short-term price movements. Specifically, there has been significant interest from institutional investors in borrowing to facilitate specific strategies, such as short, arbitrage or working capital purposes.
The Southeast Asian country recently announced a series of new regulations for crypto businesses. Among them were regulations that provoked public outrage. It recently proposed new guidelines governing the management of digital assets held by cryptocurrency operators.
Current rules already require cryptocurrency exchanges to share user information with regulators whenever funds are transferred between companies to thwart an increasing number of illegal activities under the guise of the global cryptocurrency industry. It is
In early January, crypto fund managers and investment advisors were also required to apply for a license to continue operating. Previously, money his managers trading assets outside the statutory definition of securities, futures contracts, or equivalent financial instruments were not subject to SEC oversight. Unregulated Portfolio Investors in crypto funds managed by her manager were also not protected by the Investor Compensation Fund.