The Thai government plans to expand the regulatory framework for digital assets. According to a Bloomberg reportthe plan will make the Bank of Thailand (BOT) a second watchdog for the digital asset industry.
Under the current framework, in place since 2018, the Securities and Exchange Commission (SEC) is the sole regulator of the digital asset industry. In an interview, Thailand’s Finance Minister Arkhom Termpittayapaisith said this framework is not clear enough for the industry.
“Currently, the central bank does not have the ability to enter into the regulatory framework except to notify that cryptos are not a legal means of payment for goods and services. So the framework is not clear enough to regulate the industry,” he said.
Compared to other markets, he pointed out that with exchanges “you have the paper to prove that you are the owner”. The equivalent of this in the digital world is simply the lax consent agreement that users never read.
Bank of Thailand Governor Sethaput Suthiwartnarueput added that the changes would help draw more “red lines” on digital assets. The SEC has been tasked with making the changes that will overhaul the current framework.
Thailand still seeks to encourage innovation in digital assets
The government’s decision comes following a downturn in the digital asset market that has rattled retail investors. Zipmex users in the country have been suspended from withdrawing their assets as the SEC-regulated exchange encountered financial problems.
Zipmex resumed withdrawals for most of its services and requested a moratorium from Singapore to protect it from lawsuits from its creditors. The SEC also opened investigations into the matter and called on affected users to file complaints, but was criticized for not acting faster to protect investors.
Despite this, the SEC is still keen to encourage the digital asset industry. The commission this month approved licenses for four more digital asset companies, bringing the total number of approved entities to 21, with more pending approval.
Likewise, the BOT continued to work on its central bank digital currency (CBDC) plans. Earlier this month, the central bank announced that it would launch a two-way, limited-scale pilot test of real-world applications for its retail CBDC. However, he clarified that it is still uncertain whether or not Thailand will launch the CBDC.
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