Thailand’s ministry of finance has put into place today a new law that aims to control and regulate cryptocurrencies and initial coin offerings (ICOs).
The country’s Securities and Exchange Commission (SEC) will be in charge of overseeing and regulating all digital currency transactions in addition to verifying the identity of clients. The new law also comes with fines and jail terms as Thailand works at stamping out fraud and unauthorised transactions.
In February, the country’s central bank, the Bank of Thailand, banned financial establishments from getting involved with cryptocurrency transactions. At the time, it was reported by Reuters that there was fear of possible problems from unregulated trading.
The central bank’s governor, Veerathai Santiprabhob, also stated that banks were prohibited from allowing clients to use credit cards to buy digital currencies. Following the bank’s decision, the Finance Ministry then proposed the law. According to Apisak Tantivorawong, Thailand’s finance minister, the law was a necessary requirement to crack down on money laundering, tax avoidance, and crime related to cryptocurrencies and ICOs, reports The Strait Times.
In the report, it states that ‘…unregistered token brokers or those who perform token transactions through unregistered brokers will face a jail term of up to two years and fines of at least two times the token values, up to a maximum of 500,000 baht (S$20,930).’
It adds:
Fraudulent filings could invite a five-year jail sentence. Those who carry out unauthorised business in digital assets face jail terms of between two and five years.They could also face fines of up to 10,000 baht for each day that the business was conducted.
Those who permit others to use their accounts to carry out transactions face a jail term of up to one year and can be fined up to 100,000 baht.
Thailand, which views ICOs and cryptocurrencies as digital assets, has also set a 15 percent capital gains tax on each digital transaction under a separate law, However, while The Thai Blockchain Association has protested against this, claiming that it will stop investors from getting into the market, economist Dr Anusorn Tamajai explained to The Straits Times that it would help to boost investor confidence.
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