Thailand to Ban Crypto Lending and Staking
- Once implemented, the new rules will prohibit crypto companies from taking a deposit of digital assets with a promise to pay returns to depositors.
- The Thai SEC has now opened a public hearing regarding the planned ban on crypto lending and staking, and will be collecting opinions until 17 October.
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Thailand’s Securities and Exchange Commission is planning to ban crypto businesses from providing support for staking and lending services in the country, the regulator said in a press release on 15 September.
According to the announcement, the government agency had already approved a proposal at the start of September, agreeing to restrict cryptocurrency-based businesses from providing and supporting digital asset depository services. Thailand’s SEC has now invited industry participants and individuals to express their opinion on the matter, with the public hearing process closing on 17 October.
The proposed rules will ban companies from taking digital asset deposits intended to be used for loans, as well as for services that promise to pay returns to the depositors in the future. The SEC also intends to ban the advertising and soliciting of such services to the general public.
Once implemented, the new rules will basically prohibit “digital asset business operators” from providing any staking and lending services in the country, a move intended to protect investors and the general public from the “risks of such transactions”. Thailand decided to take such radical measures in response to the crypto market meltdown from earlier this year, which saw companies such as Celsius Network and Voyager Digital freeze withdrawals, and eventually file for bankruptcy.
This is not the first time this year the Thai SEC decided to implement stricter crypto rules, having banned the use of cryptocurrency as a means for payment for goods and services in the country back in March. At the time, the regulator cited market volatility, cyber theft, personal data leakage, and money laundering concerns as the reasons behind the new rules.
- One of the largest banks in Thailand, Kasikornbank (KBank), acquired local crypto exchange Satang for $103 million only a month after setting-up a $100 million fund for web3, fintech, and AI.
- Once the acquisition has been completed, KBank plans to rebrand Satan to Orbix, and separate the business into three divisions, a custody platform, crypto venture arm, and blockchain development.
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- During an interview with FT, CEO Brian Armstrong said that before the lawsuit a SEC staff member had said that all crypto except BTC was security, and should be delisted.
- When asked how he came to that conclusion, the SEC staff member reportedly said “we’re not going to explain it to you, you need to delist every asset other that Bitcoin”.
- A federal judge ruled that the sale of XRP through exchanges and algorithms did not qualify as selling securities, which could have a major impact on several SEC lawsuits.
- The institutional sale of the token, however, did violate federal securities laws, and the lawsuit between the SEC and Ripple will have to go to trial.