April 26, 2022
During the first quarter of 2022, Thailand’s Securities and Exchange Commission (SEC) announced a series of notifications aiming to strengthen the regulatory regime for digital assets while safeguarding investors’ interests. The updated rules and conditions apply to digital asset business operators licensed by the SEC.
The key features of the new notifications, which took effect in March and April 2022, are summarized below.
Custody of customers’ assets (effective March 1, 2022)
As custodians of their customers’ assets, digital asset business operators must:
Segregate customers’ assets in their custody so that the operators can clearly identify which assets belong to which investors. If customers’ digital assets are to be deposited with a third party, the operators must inform the customers accordingly.
Refrain from seeking benefits from customers’ assets in any manner other than the purpose for which the assets are held. This includes refraining from using customers’ assets to provide benefits to others or to the customers themselves, and from depositing customers’ digital assets with a custodian that intends to lend out the digital assets (but does not include giving the customer’s assets to a licensed digital asset fund manager for investment in digital assets).
Reconcile customers’ assets and keep evidentiary documentation for a period of at least five years.
Privacy coin services (effective April 1, 2022)
Digital asset business operators are prohibited from providing privacy coin services that can conceal (or allow the concealing of) specific transactional information, such as data about the transferor, the transferee, and the transfer amount.
Digital asset business operators that provided privacy coin services to customers before the effective date of these new regulations may continue to provide such services, but they must arrange for their customers to disclose at least the required transactional information or agree not to engage in information concealment.
Digital assets as a means of payment (effective April 1, 2022)
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