Thailand is now issuing business licenses to approved cryptocurrency exchanges
Four exchanges have been granted approval, two have been rejected and one is still pending a decision
Cryptocurrencies saw a massive rise in popularity in 2017. This exponential gain of interest saw tons of money being pumped into the market, and experienced a huge influx of many private and institutional investors, as many early investors were realising astounding gains from their crypto assets. Much of the public and many governing bodies did not see such a crypto-boom coming, and therefore, many governments were left scrambling to figure out how to handle this new and booming market.
Furthering the confusion was the subsequent boom in Initial Coin Offerings (ICOs), many of which turned out to not live up to their promise of utility, to being straight-up scams. Unlike cryptocurrencies like Bitcoin, these ICO's were owned,created and controlled by a centralized source. Other concerns were related to the establishment of a myriad of new cryptocurrency exchanges, where one can buy, sell and trade their crypto assets. Some exchanges, which hold the private keys to their users' cryptocurrencies in a central location, fell victim to hacks, and mismanagement of holdings, resulting in some serious losses for the users involved. To the misfortune of those negatively affected by hacks or poor business practices of these exchanges, there was no regulating body of which could protect their holdings, or statutorily hold exchanges accountable. With such s fast-moving and wild west-like environment manifesting, some governments hedged their bets against the growing space and banned or heavily restricted ICOs, cryptocurrencies and/or cryptocurrency exchanges. One such country was Thailand.
In February 2018, Thailand's central bank decried Thai financial institutions from involving themselves with any activity related to cryptocurrencies. The central bank was concerned that there was too much risk associated with potential unregulated trading, money laundering, support of terrorism, therefore making the declaration that cryptocurrencies would not be recognized as legal tender. Since the proverbial dust has now settled, many bad actors in the ICO space have gone away, and hacked exchanges have made attempts at reparations for affected clients, squeamish governments are also turning a corner.
Announced today, Thailand's SEC states that the Ministry of Finance has approved 4 companies for the issuance of digital asset business licenses. Bitcoin Company Limited (BX), Bitkub Online Co., Ltd. (BITKUB), Satang Corporation Limited (Satang Pro) have all been granted permission for licensure as digital assets trading centers. Coins TH was granted permission to operate as a broker and trader of cryptocurrencies. Two rejections were also decided against Cash2Coins Company Ltd. and Southeast Asia Digital Exchange Ltd. (SEADEX), both seeking licensure as exchange/trading platforms. The rejection came down due to perceived lack of sufficient KYC (know your customer) protocol, and cyber-security measures. These determinations will require both companies to cease business operation by January 14, however each is entitled to reapply once the standards have been met. Coin Asset Ltd. is still pending an SEC decision, due to some recent, major changes in their operations, which will require further review. Though their review is pending, the company has been allowed to carry out operations until that final decision has been reached.