Thailand bans meme coins, NFTs and exchange tokens in new regulation for crypto market

Thailand bans meme coins, NFTs and exchange tokens in new regulation for crypto market

The Thai SEC board has issued a new Gazette banning specific tokens.

Story highlights
  • New Thailand law prohibits crypto exchanges from listing utility tokens and some types of cryptocurrencies.
  • It mentions meme coins to have “no clear objective or substance or underlying.”
  • The law aims to protect the interest of digital asset traders in the country.

Thailand has announced a selective ban on cryptocurrency trading that targets meme coins and NFTs. The Securities and Exchange Commission (SEC) Board prohibit digital asset exchanges from providing services in relation to these tokens.

The new resolution was passed in an SEC Board meeting held on June 9, 2021. As per SEC Secretary-General Ruenvadee Suwanmongkol, the board passed the new law under "Rules, Conditions and Procedures for Undertaking Digital Asset Businesses," which came to effect on June 11 following its publication in the Government Gazette.

The law prohibits crypto exchanges in the country from listing utility tokens and certain types of cryptocurrencies. This includes Meme tokens, Fan tokens, Non-fungible tokens (NFT) and Digital tokens. The Thai SEC has directed digital asset exchanges to delist these within 30 days of the effective date of the notice, that is, June 11.

The Thai SEC states that the new regulatory guideline is meant to protect the interest of digital asset traders. It mentions that meme coins have "no clear objective or substance or underlying" and that their price is largely dependent on social media trends. Some famous examples of these include Dogecoin, SafeMoon, and Shiba Inu. Similarly, the SEC points out Fan tokens as those which are "tokenized by the fame of influencers," deeming them unfit for traders.

The Thai SEC also banned NFTs and tokens "issued by digital asset exchanges or related persons," known to traders as exchange tokens. NFTs act as certificates of ownership for unique digital art, while exchange tokens are those offered by cryptocurrency exchanges to their users to enable further investments or transactions.

The new rules also specify that the exchanges "set a requirement to be imposed in the event that digital tokens issued by their own exchange or related persons are listed on the exchange." Any token issuer failing to comply with the white paper and relevant rules in this regard could have the tokens delisted from the exchange.

The guidelines by Thailand are the latest efforts by a country to regulate its cryptocurrency market. Last week, El Salvador became the first country to accept Bitcoin as legal tender. On the other hand, China cracked down on private cryptocurrency mining last month, specifically targeting Bitcoin. As governments around the world continue to take different approaches to crypto use, it will be interesting to see what the future holds for the most loved result of blockchain technology.

Also read: | Tesla to resume Bitcoin payments when mining shifts to clean energy, Musk reasserts