Thailand Limits Introducing Brokers to Digital Token Services Only


The local regulator issued a warning to ensure cryptocurrency companies adhere to regulations, mandating that cryptocurrency advertisements and promotions include risk warnings.

The Securities and Exchange Commission (SEC) in Thailand cautioned digital asset exchanges about their advertisements and the hosting of introducing broker agent (IBA) events, as reported by Bangkok Post today (Monday). The regulator clarified that IBAs are permitted to promote only digital token services to prevent speculation on cryptocurrencies, which are considered high-risk assets.

Thailand’s Regulations and Oversight of Digital Asset Exchanges

Introduction of Introducing Broker Agents (IBAs): IBAs, which are local companies or agents facilitating client onboarding for partner digital asset exchanges in local markets for commission, are common practices for exchanges or brokers operating indirectly in certain markets.

Regulatory Warning and Compliance: The Thai regulator issued a warning to digital asset exchanges regarding their advertisements and IBA events, emphasizing compliance with local regulations. This move aims to ensure adherence to local business standards and prioritize investor benefits and protection.

Legal Landscape for Cryptocurrency Exchanges: Cryptocurrency exchanges are legal in Thailand, contingent upon obtaining local approval. Notably, last month, the country permitted asset management firms to launch private funds for bitcoin exchange-traded funds (ETFs), catering exclusively to institutional and ultra-high-net-worth investors.

Recent Regulatory Measures: However, Thailand has prohibited the sale of cryptocurrency lending products and mandated that exchanges display risk warning messages, reflecting ongoing efforts to regulate and safeguard the cryptocurrency market.

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Thai Regulator Emphasizes Compliance in Cryptocurrency Advertising

The recent cautionary directive underscores the Thai regulator’s commitment to ensuring that crypto exchanges‘ advertisements and sales promotions adhere to specified criteria, while also preventing dissemination of false, exaggerated, distorted, or misleading information. It highlights the necessity of including mandatory warnings about investment risks in all advertisements and promotions.

Anek Yooyuen, Deputy Secretary-General of the Thai SEC, emphasized the risks associated with organizing sales promotions that offer rewards to entice people to use cryptocurrency services. Such practices could encourage usage without due consideration of investment risks, particularly in the case of cryptocurrencies.

The SEC urges business operators to strictly adhere to the rules and exercise caution when organizing IBAs, advertising, and sales promotions, ensuring compliance with relevant rules and guidelines. Violations will result in legal consequences according to the law.

Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.


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