Thailand to offer tax breaks for investment token issuers

March 7, 2023 Coin Telegraph

The government of Thailand expects that investment token offerings could generate more than $3.7 billion in the next two years.

The government of Thailand is moving to benefit from the digital asset industry growth by allowing tax-free issuance of digital tokens for investment.

Thailand's cabinet has agreed to waive corporate income tax and value-added tax (VAT) for companies that issue investment tokens, Reuters reported.

Announcing the news on March 7, deputy government spokesman Rachada Dhnadirek said that companies will be able to access alternative ways of raising capital through investment tokens in addition to conventional methods like debentures.

Rachada added that the government expects investment token offerings to generate 128 billion Thai baht ($3.7 billion) over the next two years. The state estimated potential losses of tax revenues at 35 billion baht ($1 million).

Thailand has taken a lot of steps to clarify local crypto-related taxation rules, with authorities suggesting the adoption of a 15% capital gains tax for investors in early 2022. The government subsequently scrapped the plans, exempting crypto traders from the 7% VAT on authorized exchanges a few months later.

Local regulators were also working to implement wider crypto regulations last year, with Thailand's Securities and Exchange Commission banning the use of cryptocurrencies for payments in March 2022.

The news comes amid the Thai SEC continuing to work on stricter crypto regulations to protect investors. In January 2023, the financial regulator introduced new rules for crypto custody services, requiring all crypto custodians to have a contingency plan in case of unforeseen events.

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March 7, 2023 Bitcoin.com

Zipmex says it may resume 100% of Z wallet withdrawals subject to conditions

February 15, 2023 Coin Telegraph

Coin Telegraph

The creditors have until February 21, 2023, to vote on a new scheme proposed by the company.

According to a new press release on Feb. 15, Thai cryptocurrency exchange Zipmex stated that it sent a new scheme to all firm's eligible creditors through its scheme manager KordaMentha. As told by Zipmex, the creditors have until Feb. 21, 2023 to vote on the scheme and "will receive 100% of their digital assets in the Z Wallet" if the scheme is approved and the cryptocurrency closes its pending investment deal.

Last July, Zipmex filed for debt relief in Singapore after its counter-party and crypto lending firm Babel Finance halted withdrawals, citing "unusual liquidity pressures." The exchange was also impacted by the bankruptcy of crypto lending firm Celsius. Together, the two counterparties owe Zipmex $48 million and $5 million, respectively.

Zipmex subsequently paused withdrawals on its platform after the revelations last July. However, withdrawals were resumed within two days for its fiat currency and trading funds service Trade Wallet. That said, the firm's Z Wallet, used for Zipmex services and receipt of earnings and bonuses, remains in the debt moratorium state with gradual resumption of withdrawals.

Cointelegraph previously reported on Dec. 2, 2022, Thai Venture Capital V Ventures will acquire Zipmex for $100 million in cash and crypto. According to court documents, Zipmex plans to use cryptocurrency assets received from the transaction to unlock frozen customer accounts on the exchange by April 2023. Subsequent to the development, on Jan. 11, 2023, the Securities and Exchange Commission of Thailand began a new probe of Zipmex, alleging a breach of local rules. The regulatory agency has also warned investors to carefully review documents issued by the company before making a deal.

Thailand Issues New Regulations on Custodied Cryptocurrencies

January 19, 2023 Bitcoin.com

SEC of Thailand issues crypto custody provider rules

January 17, 2023 Coin Telegraph

Coin Telegraph

The Thai securities regulator now requires crypto custodians to have a contingency plan in case of unforeseen events.

The Securities and Exchange Commission (SEC) of Thailand is working to better protect cryptocurrency investors by introducing new rules for crypto custody services.

On Jan. 17, the Thai SEC issued regulations requiring virtual asset service providers (VASP) to establish a digital wallet management system to guarantee efficient custody. The new rules target crypto custodians or VASPs that provide crypto storage services.

The regulations include three major requirements, including the provision of policy and guidelines for overseeing the risk management of digital wallets and private keys. The rules require VASPs to communicate with regulators regarding such policies and provide action plans to ensure compliance.

Additionally, the SEC requested crypto custodians provide policies and procedures for designing, developing and managing digital wallets and keys. The authority will also require crypto custodians to establish a contingency plan in case of unforeseen events that may affect the wallet management system.

“This includes laying out and testing action procedures, designating responsible persons and reporting the event,” the SEC stated, adding:

“An audit of system security is also required as well as digital forensic investigation in case of any event affecting the security of systems related to digital asset custody, which could cause significant impacts on clients’ assets.”

According to the announcement, the new regulations have taken effect starting from Jan. 16, 2023. Crypto custodians are required to fully comply within six months from the effective date.

The latest crypto regulations by Thailand’s SEC align with the authority’s plans to adopt more strict crypto regulations in the aftermath of industry failures like the FTX collapse. In early January, the authority reportedly started a new investigation against a local crypto exchange Zipmex, alleging that the firm has been providing digital asset fund management services without permission.

Bank of Thailand to allow first virtual banks by 2025

January 15, 2023 Coin Telegraph

Banks

By allowing virtual banks, Thailand seeks to boost competition and economic growth.

Bank of Thailand (BOT) has disclosed plans to allow virtual banks to operate in the country for the first time. Financial firms will be able to provide services by 2025, a Bloomberg report shows.

The ‘Consultation Paper on Virtual Bank Licensing Framework’ has been published by the central bank, and applications shall be available later in 2023, allowing virtual banks to act as financial services providers. The move focuses on boosting competition and Thailand's economic growth.

The BOT will issue three different licenses for interested companies by 2024. There are at least 10 parties interested in granting permissions, the report states.

Regulations and supervision for virtual banks will be the same as those for traditional commercial banks under the licensing framework. Moreover, qualified applicants will need to meet certain requirements. The country's central bank also noted:

"Virtual banks should not initiate a race to the bottom through irresponsible lending, give preferential treatment to related parties, nor abuse dominant market position which will pose risks to financial stability, depositors, and consumers as a whole."

According to the central bank, virtual banks will be under a "restricted phase" during their first years of operation, which includes close monitoring to prevent financial systemic risks. Thailand's Security and Exchange Commission recently announced plans to tighten rules for crypto, aiming to expand investor protection. A strict set of guidelines for crypto ads is also being developed by the authority.

Thailand recently entered into a technology cooperation agreement with Hungary to support the adoption of blockchain technology, amid a fast growth of demand for mobile payments, e-commerce, and cryptocurrencies in the country, Cointelegraph reported.

The country has seen a number of crypto-related developments in 2022, including plans to pilot a central bank digital currency (CBDC) for roughly 10,000 users. Thailand is ranked eighth on the Global Crypto Adoption Index by analytics company Chainalysis.

Crypto exchange Zipmex probed by Thai SEC amid buyout

January 11, 2023 Coin Telegraph

BMW Partners With Coinweb to Develop Blockchain-Based Vehicle Financing Automation and Loyalty Program in Thailand

December 31, 2022 Bitcoin.com

Thai SEC to tighten up rules for crypto, focus on investor protection

December 13, 2022 Coin Telegraph

Coin Telegraph

Thailand's chief regulator highlights the importance of tighter control over the cryptocurrency-related advertisements.

Thailand joins the growing list of countries that are seeking to revise their crypto regulation in the aftermath of the FTX collapse. And, as most of these countries do, it intends to tighten the guidelines for the industry and focus on investor protection.

According to the report from the Bangkok Post, published on Dec. 13, the Thai Securities and Exchange Commission (SEC) is preparing more stringent regulations on digital assets “to mirror the global market.” To justify such a decision, the SEC representatives reportedly nodded on the failures of FTX, Three Arrows Capital, the TerraUSD, Celsius Network and the local exchange, Zipmex.

The regulators also raised their concern with the recent trends in crypto advertising, notably the use of “finfluencers” to deliver the message, which could have misled the audience into investment risks. They deemed the digital asset industry to be “vulnerable” and in need of oversight.

The SEC highlighted investor protection, control over crypto advertising, prevention of conflicts of interest and cybersecurity as major areas to focus its efforts on. It has set up a working committee, combined with both officials and private stakeholders, to assess and prepare the relevant amendments to existing regulations.

Interestingly, it’s not the first time the Thai SEC acts on crypto advertising standards. It has already obliged the market players to have clear investment warnings to consumers back in September.

The same month the SEC opened a public hearing on its initiative to prohibit crypto platforms from providing or supporting digital asset depository services. The possible ban of any staking and lending services is supposed to protect traders and the general public.

In Thailand, the wave of crypto businesses’ bankruptcies stroke one of the largest local platforms, Zipmex. In July, the company suspended withdrawals, citing a “combination of circumstances beyond [its] control.” The SEC accused Zipmex and its co-founder Akalarp Yimwilai of non-compliance with local laws and referred the matter to the police.

Thai VC fund acquires troubled exchange Zipmex for $100M: Report

December 2, 2022 Coin Telegraph

Thai VC fund acquires troubled exchange Zipmex for 0M: Report

Coin Telegraph

Zipmex reportedly plans to use crypto assets received from the acquisition to unlock frozen customer accounts on the platform by April 2023.

After weeks of negotiations on a potential buyout of Zipmex, venture capital fund V Ventures has reportedly reached a deal to acquire the embattled cryptocurrency exchange.

V Ventures, a subsidiary of Thoresen Thai Agencies (TTA) public company, is looking to purchase a 90% stake in Zipmex crypto exchange, Bloomberg reported on Dec. 2.

The VC fund is about to acquire Zipmex for about $100 million in digital assets and cash, anonymous sources familiar with the matter claimed. Citing a court hearing on Friday in Singapore, the report says that Zipmex was offered $30 million in cash and the rest in crypto.

According to the court hearing, Zipmex is planning to use cryptocurrency assets received from the transaction to unlock frozen customer accounts on the exchange by April 2023.

The acquisition report comes weeks after local media reported that V Ventures and Zipmex were on track to sign a majority buyout agreement.

As previously reported, Zipmex abruptly halted withdrawals on its platform in July 2022, citing a “combination of circumstances” beyond its control. The exchange, which has operations in Thailand, Singapore, Indonesia and Australia, subsequently started a restructuring process after getting three months of creditor protection from Singapore’s High Court.

Zipmex has also filed applications to extend the moratorium until April 2023 to support the restructuring efforts, which is pending consideration by the Singapore court.

Despite facing major issues, Zipmex has apparently continued offering some of its services after partially resuming withdrawals. According to Zipmex’s website, the exchange has been altering some of its withdrawal fees as well as listings over the past two months.

Zipmex and TTA did not immediately respond to Cointelegraph’s request for comment.

The news comes shortly after Thailand’s Securities and Exchange Commission (SEC) accused crypto exchange Zipmex and its co-founder Akalarp Yimwilai of violating local laws. The authority specifically argued that Zipmex had not provided information on digital wallets and crypto transactions in compliance with the country’s Digital Assets Act.

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