Thai SEC Seeks Public Input on Revised Capital Rules for Digital Asset Operators

Thai SEC Seeks Public Input on Revised Capital Rules for Digital Asset Operators

by May 15, 2024

Thailand’s Securities and Exchange Commission (SEC) is calling for public input on proposed regulations concerning capital requirements for securities companies and derivatives business operators involved in digital asset services.

These updated regulations aim to align with current market developments, ensure adequate protection for digital asset traders, and establish uniform standards for all digital asset operators.

This initiative follows an earlier public consultation on the proposed principles for amending capital rules for digital asset operators, which included capital requirements for those in securities and derivatives. Feedback from the previous hearing has been considered in the latest draft.

The SEC’s new public hearing focuses on draft regulations and relevant attachments for capital requirements applicable to business operators in digital asset exchanges, brokerage, and dealing.

The goal is to ensure these operators meet the same standards as those not involved in securities or derivatives.

The draft regulations propose revising minimum capital requirements to support digital asset business operations.

This includes adjusting net capital (NC) requirements for assets in hot and cold wallets to match the proportions and sources of digital asset custody for clients, and incorporating NC requirements for digital asset trading service risks.

Criteria for suspending business operations will also be revised, requiring businesses that fail to maintain the necessary capital to submit and execute a rectification plan.

If a business operator fails to comply, it must suspend digital asset operations and inform clients.

Additionally, the regulations suggest alternative channels for capital maintenance, such as insurance policies or digital assets of the same type as clients’ (same coin), and specify the timeframe for submitting net capital calculation reports.

The consultation paper is available on the SEC website. Stakeholders and interested parties can submit comments and recommendations via email. The public hearing concludes on 27 May 2024.