Thailand Puts A complete Ban on the Use of Cryptocurrencies for Payments

After working around for its crypto regulations, Thailand has issued rules to ban the use of digital assets for paying for goods and services in the country next month onwards from April 1.

The move comes after a series of discussions between Thailand’s Securities and Exchange Commission (SEC) and its central bank aka Bank of Thailand (BoT). The authorities have said that Thailand needs to regulate this activity regarding the use of crypto as it could severely impact the country’s financial stability.

As per the notice issued by the Thai SEC, businesses in Thailand have been advised against accepting crypto payments from April 2022. The joint statement issued by the SEC and the BoT notes: “[Crypto payments] may affect the stability of the financial system and overall economic system including risks to people and businesses”.

The SEC has also highlighted risks with the use of crypto such as extreme price volatility, money laundering, cyber theft, and personal data leakage. One the rule is launched, businesses in Thailand won’t be able to advertise the acceptance of crypto payments or setting up crypto systems, tools and wallets that facilitate crypto transactions.

Any business found in non-compliance to the crypto laws will be subject to legal actions that can include temporary suspension as well as cancellation of the services. The SEC notice states: “However, the BOT and the SEC, as well as other government agencies, recognize the benefits of technologies behind digital assets such as blockchain and value and support the use of technology to further innovation.”

The Thai SEC also seeks to ensure investors’ security by measuring the quality of services offered by crypto businesses. As per the proposal, the SEC has asked digital asset operators to “Prepare and deliver [service quality and system capacity utilization reports] to the SEC office on a monthly basis within the 5th day of the following month.”

Apart from asking businesses to send monthly reports, the Thai SEC has also asked businesses to put it on their website regarding the suspension of crypto services.

While Thailand has been mulling to ban the use of crypto for payments, another Asian country Malaysia is considering to make Bitcoin a legal tender. Meaning, just like El Salvador, Bitcoin will be accepted at every merchant location along with the state fiat.

Countries across the world have been dealing with cryptocurrencies differently while considering the risks involved as well as the opportunities in this sector.