Thai securities regulator to ban crypto custodians from lending clients’ assets

August 28, 2021
Thailand’s Securities and Exchange Commission (SEC) has made amendments to the rules governing the operations of crypto custodians. The SEC has published a consultation paper on the amendments,inviting stakeholders and other interested parties to send their comments and suggestions by Sept. 22 to boost investor protection for those who keep money in digital assets.
The amendments require providers of crypto custodian services to “comply with the principles for decentralized approval authority, multi-sign approval authority, and check and balance” in regards to the custody of both digital assets and fiat money.
Noting its objective is to ensure businesses provide quality services and adequate protection for investors, the SEC elaborated: “This means the records of investors’ assets under custody of the business operators must be accurate, complete and updated while the assets must be properly protected from relevant risks”. Clients’ assets shall be reconciled every business day to ensure accurate and updated records,” the SEC stressed.
Thailand’s Securities and Exchange Commission wants to ban operators from “seeking benefits from clients’ fiat money,” except through deposits with commercial banks, in which case they may agree with customers on an interest rate not exceeding the one provided by the bank. The regulator noted that crypto custody businesses will have to comply with the new regulations within a month after their final adoption.
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