Thailand mandates ‘in-person’ KYC for crypto traders |

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“Custodian of virtual asset” The Thai SEC has mandated that all cryptocurrencies must be held by a “custodian” in order to be “traded on any exchange”.

Thailand’s SEC has mandated that all cryptocurrency exchanges in the country must insist that all trading customers visit their offices in person to perform their Know-Your-Customer (KYC) verification. The exchanges have been given 30 days to revise their user registration processes to implement the new system.

Thai crypto traders will soon have to be physically present when opening an account with one of the many exchanges and wallet providers based in the country, local publication Bangkok Post reported today.

A growing market for crypto-currencies

The country is a small but growing market for cryptocurrencies. According to the local Securities and Exchange Commission, trading volume will exceed $3.96 billion in 2021 – up from less than $574.5 million in November 2020 – amid broader demand for cryptocurrencies and a growing market.

But concerns about fraud and illegal activity remain because of the nature of the space. And while Thailand has adopted limited know-your-customer (KYC) policies, none were as radical as today’s rule.

According to the report, local cryptocurrency exchanges are required to verify the identity of their customers using microchips, the owners of which must be physically present. The measure, which comes into effect in September 2021, specifically targets the country’s gold and jewelry market.

By law, dip tokens are required for transactions at any gold shop in Thailand. Some say the data collected helps manage relationships between companies and customers, but others say it leads to data breaches.

Meanwhile, the cryptocurrency industry will have to get its act together and discuss the issue at a forum to be organized by the Thailand Digital Asset Operators Trade Association, a self-regulatory body, later this year.

The association will continue its dialogue with the Securities Commission of Thailand and the Anti-Money Laundering Office (Amlo).

What is going on?

Current Thai cryptocurrency exchanges conduct KYC and AML checks in accordance with global standards, such as. B. Verification of identity and bank account. All these operations are performed electronically.

However, this takes time. Exchanges should physically verify documents provided by customers and verify that they are in compliance with SEC rules regarding the KYC process and suitability test.

Meanwhile, some think the new regulations could block the rapid growth of the cryptocurrency market in Thailand. In April, an estimated 697,780 cryptocurrency traders were registered with local cryptocurrency exchanges, nearly six times the number from last year, when there were only 160,000.

Most digital asset exchanges are still preparing their systems for the growing number of customers, while applications for new accounts continue to pour in, said Poramin Insom, founder of local cryptocurrency exchange Satang.

He concluded with these words: However, this growth may be slowed if the demand process becomes more complex.

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