One of the main goals of the Securities and Exchange Commission (SEC) of Thailand is to improve investor security by introducing new regulations for cryptocurrency custody services. This will better protect cryptocurrency investors.
On Jan. 17, to ensure effective custody, the Thai SEC published regulations requiring virtual asset service providers (VASP) to introduce a digital wallet management system. The new guidelines apply to VASPs or crypto custodians who offer services for crypto storage.
The rules include provisions for policies and practices for managing the risk management of digital wallets and private keys. These are the three main requirements. The regulations require VASPs to inform regulators of the aforementioned policies and to offer action plans to ensure compliance.
Crypto Rules
The SEC also required cryptocurrency custodians to offer policies and instructions for creating, managing, and using digital wallets and keys. The authority will also demand a backup plan if unforeseen circumstances impact the wallet management system.
A system security audit is also necessary, along with a digital forensic investigation, in the event of any event affecting the security of systems related to the custody of digital assets and having the potential to have significant effects on the assets of clients, according to the SEC. This includes developing and testing action policies, appointing dependable individuals, and reporting the event.
The announcement states that the new rules became operative on January. 16, 2023. Custodians of cryptocurrency must fully comply within six months of the effective date.
Due to industry losses like the FTX collapse, Thailand’s SEC has announced new crypto regulations that align with its plans to adopt stricter crypto regulations. According to reports, the authority opened a fresh investigation in early January into the local cryptocurrency exchange Zipmex. It alleged that it had been providing services for managing digital assets without authorization.
