Thailand to Ban Unlicensed Crypto Exchanges; Europe Considers Regulation on Non-Decentralized Protocols
Summary:
Thai authorities plan to prohibit unlicensed crypto exchanges to combat money laundering and other cybercrimes. The move follows similar steps by India and the Philippines. The Thai Securities and Exchange Commission (SEC) is urging investors to withdraw their funds from unregulated platforms ahead of the ban. It has also warned the public about the risks of using services from unlicensed operators. Concurrently, non-decentralized protocols may face a ban in Europe due to regulatory pressures.
In an effort to combat activities such as money laundering and other virtual crimes, Thai regulators have decided to prohibit crypto exchanges without official authorization from operating within their borders. The country's Securities and Exchange Commission (SEC) intends to provide a roster of unregulated crypto exchanges to the Ministry of Digital Economy and Society, an announcement confirmed by Thai SEC's secretary-general Pornanong Budsaratragoon subsequent to the Technology Crime Prevention and Suppression Committee gathering held on April 19.
The decision to restrict unauthorized entities by Thailand draws inspiration from India and the Philippines, both of which recently implemented a blanket ban on offshore exchanges that showed non-compliance with their local rules. In effort to safeguard the public from unnecessary harm, the Thai SEC is encouraging crypto investors to pull out their resources from these non-compliant platforms ahead of the ban's implementation. A translation of the announcement made by SEC stated:
"The public and investors must exercise caution while availing services of digital asset business operators that are unlicensed as they shall not enjoy the protection of the law. Additionally, the risk of deceptive practices (scams) and potential association to money laundering are high."
The Thai SEC is advising investors to verify the registration status of the platforms on the SEC Check First application prior to making any investment. The SEC Check First app reveals that Binance, a popular crypto exchange, has failed to register and thus faces a shutdown once the ban is imposed.
An inspection conducted on other prominent international crypto exchanges like Coinbase, KuCoin, Kraken and OKX indicates that these platforms do not function legally in Thailand, based on official records.
In related news, due to escalating regulatory tension within Europe, non-decentralized protocols might potentially face a prohibition. This is in line with the Markets in Crypto-Assets (MiCA) regulatory framework, which oversees digital assets across the region, mandating the European Commission to conduct an evaluation of the decentralized finance (DeFi) market by December 30, and to assess the plausibility of designing tailored regulations for the sector.
Among several key individuals in the crypto industry, Rune Christensen, co-founder of MakerDAO stated that the proposed regulation could necessitate licensing protocols for certain DeFi interfaces, including decentralized exchanges. This would limit the operation of DeFi frontends on normal Internet domains as seen today, thereby pushing for fully decentralized, locally downloaded frontends or fully-KYC online frontends.
Published At
4/22/2024 12:48:27 PM
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