The Securities and Exchange Commission (SEC) took steps yesterday to tighten the rules governing the digital asset market and penalise businesses that breach regulations.
In a statement, the regulator said digital asset ads must not contain faulty, distorted or exaggerated information, or anything that could lead to misunderstanding among the public. Information about services from digital asset operators must be for clients approved to open an account and ready to use the service.
Digital asset operators that want to advertise must inform the SEC about the budget and details of their ads, including bloggers and influencers.
The ads must indicate the investment risks and have complete information with balanced views of risks and opportunities in order to make an investment decision, according to the statement.
Cryptocurrency ads can only run in official channels because the crypto market is volatile, in order to prevent impulse buying, said the regulator. An introducing broker agent (IBA) is no longer allowed for crypto currency businesses, though digital token operators can still have an IBA.
The new rules took effect yesterday.
The SEC also fined Zipmex, the Singapore-based digital asset exchange operator, 1.92 million baht for two breaches of the Digital Asset Act. Earlier this week, Bitkub's chief technology officer was fined 8.5 million baht for alleged insider trading related to Siam Commercial Bank's failed acquisition of Bitkub.
Earlier this year, an executive of Satang Pro was fined 6 million baht for insider trading and banned one year from being an executive.
The SEC board said yesterday Zipmex has been fined for two cases: 540,000 baht for the first breach and 1.38 million for the other.
According to the SEC statement, the first case refers to July 20-28 this year when Zipmex suspended all or some of its digital asset trading services without complying with the rules, conditions and methods of trading.
The SEC informed Zipmex that its digital asset trading rules are not in compliance with the standards that professionals rely on, and that the firm is not providing quality service.
For the second case, during July 20-Aug 25 of this year, Zipmex suspended its clients' asset withdrawal service for Trade Wallet and Z Wallet, which is not in compliance with the professional standards and did not provide quality service.
According to Zipmex's announcement at that time, the company posted on Facebook on July 20 it was suspending the withdrawal service for customers' assets. On that day, customers could access the withdrawal system from Trade Wallet on the Zipmex platform as usual, but transfers from Z Wallet to Trade Wallet could not be processed.
On July 21 the company revealed that deposits between Zipmex and its business partners totalling US$53 million -- $48 million with Babel and $5 million with Celsius Network -- were in question as both partners experienced severe liquidity problems.
Following this statement, Celsius Network announced bankruptcy.
Zipmex said recently it is ready to find a new joint venture by selling shares and bringing the assets back to the investors.
Some clients are interested in buying and are in negotiations with the company.
