Thailand Shakes Up the Crypto Industry With New Regulations on Custodied Cryptocurrencies
Crypto enthusiasts in Thailand were taken aback in 2020 when the country’s government announced new regulations for custody of cryptos. The move has been seen as an official recognition of cryptocurrencies and blockchain technology, and is resulting in an increasingly friendly environment for crypto exchanges, miners, and other crypto-related businesses in the country.
What Are the New Regulations?
The regulations impose licensing requirements on cryptocurrency trading platforms, or ‘digital asset businesses’ (DABs). Any digital asset businesses will have to get approval from the Securities Exchange Commission to operate legally in Thailand.
The new regulations also cover ‘cold wallet’ operators, which is generally where digital currencies are stored offline as an extra layer of security. Specifically, the new law requires cold wallets to be part of a system that requires two-factor authentication.
What These Regulations Mean for Crypto Enthusiasts
Although the regulations may be seen as an extra layer of bureaucracy, it’s actually good news for those interested in cryptocurrencies. Before these regulations were introduced, there was a lot of uncertainty around their legal status in Thailand. Now, businesses operating in the sector have a clearer set of regulations to follow and can rest assured that they are running a completely legal operation.
The regulations also have a positive impact on investors and other crypto users. Before, many investors and traders were concerned about the security of their crypto assets. The new regulations impose strict requirements that crypto exchanges must follow to ensure their customers’ funds are secure.
New Regulations May Attract New Crypto Talent
The new regulations could also open up Thailand to new sources of crypto talent. These regulations create an environment that is much more conducive to venture capital (VC) investment and other forms of investment in blockchain tech.
This could lead to the emergence of innovative technology companies, who are looking to move their business to countries with more progressive regulations.
Things to Consider
Before diving into the Thai crypto market, however, there are a few points to keep in mind.
- Taxes: The Thai government has yet to pass any regulations on taxes related to cryptocurrencies, so all income made from cryptocurrency-related activities, such as trading and mining, may be subject to taxes.
- License: To operate legally, digital asset businesses must obtain a license from the Thai authorities.
- Restrictions: The Thai government has imposed restrictions on foreign investments in the Thai cryptocurrency market. As such, foreigners may not be able to invest in certain digital asset businesses.
Final Thoughts
The Thai government’s move to regulate custodied cryptocurrencies is a promising step for the country’s crypto industry. It could open up more investment opportunities and attract more talented employees and businesses to the country.
While there are still some important considerations to keep in mind when operating in the Thai crypto market, the new regulations could make it a much more attractive place for investors and businesses.
So, if you’re thinking of investing in crypto or starting a crypto-related business, Thailand could be a great place to look. And, who knows? Maybe you’ll even make enough money to buy a few Mai Tais.
