news – crypto
SEC issues new digital asset advertisement regulations
Thailand’s Securities and Exchange Commission (SEC) has introduced a new set of rules on advertising digital assets in Thailand. Under the new regulations, digital asset operators must provide details of any ads and spending involved, including the use of influencers and bloggers to the SEC.
There is also a new set of guidelines for companies to follow in relation to advertising as well.
The SEC has stated that operators have 30 days to comply with the new rules.
- Advertisements to digital assets will now be subject to stricter rules and requirements including warnings about the risk involved with trading such assets.
- Digital Asset advertisers are now required to provide details of any upcoming ads and spending involved, terms and time frame to the SEC.
- Advertisers have 30 days to comply with the new regulations.
Why have these regulations been introduced?
Digital asset and crypto companies in Thailand have been advertising heavily on digital/social media platforms, media print and billboards in order to promote the industry around Bangkok and Thailand.
However, there have been a few recent incidents which have had an adverse effect on digital asset companies in Thailand and attracted some scrutiny from the regulators. As a result of these incidents, Thailand’s regulator, the SEC, has recently handed out fines to crypto companies. These fines have come at a time when many such companies have been struggling due to the global slump in the value of digital currencies.
An example of such an incident is an executive from one of Thailand’s most popular portals, Bitkub, being fined 8.5 million baht ($231,670.75) this week for insider trading. Following on from this, Thailand’s fourth largest lender by assets, SCBX, backed out of their $500 million acquisition of Bitkub, stating regulatory concerns as the main reason.
Furthemore, another leading portal in Thailand, Zipmex, was fined 1.92 million baht on Wednesday for suspending withdrawals in late July.
What are the new regulations for digital asset advertisements?
The new rules are a clear statement from the SEC that incidents such as those mentioned above cannot continue. The new regulations have made it clear that all adverts relating to digital assets must include a clear warning highlighting the investment risks in and provide a balanced view of potential risk and returns.
In addition to this, information of advertising terms and the financial cost of the ads must also be given to regulators.
We have included more details relating to the new crypto advertising regulations below:
- Advertisements must not feature false, misleading or exaggerated claims
- Warnings of risks must be clear and easy to notice
- The ads must feature balanced views, mentioning both positive and negative factors
- Crypto firms must limit advertising to official channels like their websites
It is fair to say that Thailand has embraced the adoption of digital currency & digital assets and ranks among the top 10 nations of digital asset holders. However, the recent incidents have caused quite a stir in Thailand and forced the SEC into action and introduce these new changes for digital asset advertisments in Thailand.
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Frequently asked questions
What is a CBDC?
A retail CBDC is a form of digital currency. Holding a CBDC is equivalent to holding banknotes or real currency. One of the benefits of CBDCs is that they are effectively risk-free.According to the International Monetary Fund, approximately 100 countries, including China and Cambodia are currently exploring the use of CBDCs.
How does a CBDC work?
As part of the pilot scheme, there will be 2 phases.
The first phase involves the retail CBDC being used in cash-like activities such as paying for goods and services.
During this phase, the CBDC will be available for use in limited areas and in about 10,000 retail businesses. The areas in which the CBDC will be used have been selected by the BOT, along with Bank of Ayudhya (Krungsi), Siam Commercial Bank (SCB) and 2C2P (Thailand).
This first phase of testing is expected to commence by the end of 2022 and will last until mid-2023.
The second phase of the pilot scheme will be the “Innovation Track”. This phase will be used to focus on programmability and how to facilitate the development of the CBDC. This phase is expected to result in new financial services being created for a wide range of customers and to help the BOT develop and improve the design of CBDC to suit Thailand.
Additionally, as part of the 2nd phase, the BOT will allow the private sector and the public to present business use cases for the retail CBDC. These presentations will be shared as part of what will be known as the “CBDC Hackathon”.
Applications for those who wish to participate in the Hackathon will be available from the 5 August – 12 September 2022.
What are the different types of CBDC?
There is 2 type of CBDC, Wholesale CBDC and General Purposes CBDC.
What is the difference between Stablecoin, CBDC, Cryptocurrency?
Cryptocurrency: It is a digital assets for medium of exchange whose ownership is recorded in distributed ledger in the blockchain
Stablecoin: Cryptocurrency whose value refers to external assets.
CBDC: Digital currency or money that is directly issued by a central bank of Thailand
What countries are leading the CBDC race?
For now China and Sweden are in the pilot project stage. Singapore has completed the research stage and soon Thailand
Does a CBDC need a Blockchain?
No it does not, the approach should be technologically agnostic, but if created properly, and the infrastructure supports it, the use of blockchain can provide many benefits.
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