In an interview, Oliver Linch, CEO of Bittrex Global, discussed Thailand’s regulatory direction regarding the cryptocurrency sector.

Thailand’s Securities and Exchange Commission (SEC) has intensified its regulatory framework to curb unlicensed crypto activities, citing fraud and money laundering concerns.

“The SEC warns people and investors to be cautious about using unauthorized digital asset operators because they do not receive legal protection,” the regulator said in a statement.

The commission recently banned access to unlicensed crypto exchanges and introduced significant changes aimed at fortifying the digital asset market. These amendments included the removal of investment caps for retail investors in asset-backed tokens and the enforcement of stringent custodial requirements. This ensures that wallet providers are subsidiaries of publicly listed companies with secure asset management practices.

Additionally, Bitcoin ETFs are prohibited in the nation, suggesting that the regulator is taking a cautious approach to high-risk financial products. These recent moves have led many to believe that Thailand has an anti-crypto stance.

However, Linch views these regulatory actions as essential steps towards creating a more secure and structured market, ultimately benefiting both investors and the broader cryptocurrency ecosystem.

By giving the green light for institutional investors and ultra-high net worth individuals (UHNWIs) to purchase Crypto ETFs, Thailand’s SEC is ensuring it is keeping pace with wider APAC regulatory developments regarding digital assets. The move reflects the country’s evolving status as a regional crypto hub, embracing various blockchain and DeFi initiatives and hosting significant industry conferences.

The Thai SEC’s recent enforcement against unlicensed crypto platforms aims to reinforce investor confidence and market stability by ensuring a regulated environment for cryptocurrency trading. The move also reflects the country’s efforts to integrate and advance its financial services with developments in the wider APAC and global financial ecosystem.

There seems to be a narrative developing that all enforcement action is somehow “anti-crypto.” This is not correct. If a country has a proper regulatory framework and a realistic and viable mechanism for getting licensed, then it is right and proper that robust enforcement action is taken against those that disregard the rules. Enforcement action as part of an enabling regulatory framework is not “anti-crypto”; it can actually assist in providing regulatory clarity and certainty. By taking action in this way, Thailand should be in a stronger position to attract inflows and market participants.

Thailand’s regulatory alignment with Asian counterparts suggests a concerted effort, at least on a regional basis, to establish consistent guidelines for the cryptocurrency industry. This could factor into the development of global governance standards in due course. The positive knock-on impact of Hong Kong’s recently approved crypto ETFs is also reverberating around the region and will likely spur positive developments for the wider APAC market. These measures, along with increasingly positive signals from Singapore and Korea, mean that countries like Thailand could benefit from the spin-off of a burgeoning APAC crypto market.

Thailand’s SEC has chosen not to allow spot bitcoin exchange-traded funds (ETFs), an approach similar to South Korea’s, which also decided against allowing such ETFs in its domestic markets. Both Thailand and South Korea’s regulatory approaches emphasize investor protection and regulatory clarity. With both countries boasting high rates of crypto retail adoption from an active crypto trading community, regulators in Thailand and South Korea aim to strengthen consumer safeguards and mitigate market risks that may stem from unauthorized trading platforms.

Regulators should focus on proactive measures against unauthorized cryptocurrency platforms, leveraging enforcement actions, industry collaboration, and investor education to ensure compliance without stifling innovation.

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