Thailand’s SEC Warns Crypto Exchanges Over Advertising

The Securities and Exchange Commission of Thailand (SEC) has warned digital asset platforms about promoting cryptocurrencies and misleading s. According to local reports, these platforms need to be careful about advertising and focus on delivering profits to investors.

The warning follows efforts by regulators to tightly regulate the country amid growing concerns about online fraud related to cryptocurrencies.

Exchange ads must comply with regulatory rules

bangkok post informed The SEC’s latest crackdown on Thailand’s cryptocurrency industry was announced on Monday. The country’s regulator has warned digital asset exchanges to proceed with caution, according to the report.

The SEC has warned platforms regarding advertising and hosting IBA (Introducing Broker Agent) events, saying these activities may “violate regulations” overseen by the IBA.

Cryptocurrency exchanges must operate with a focus on providing returns to investors and comply with the regulatory business standards of the country in which they operate. All advertising and promotions must not contain false, exaggerated, distorted, concealed or misleading information.

Additionally, advertising and promotions are required to alert investors to the risks associated with cryptocurrency investments. The regulatory framework also mandates promotional campaigns to “not rush customers” into deciding whether to use an exchange to invest in digital assets.

The SEC noted that the IBA can only promote digital token services “to avoid speculation in cryptocurrencies, which are high-risk assets.”

SEC Deputy Secretary General Annek Yuyuen said exchanges “often attract investment by offering special privileges to the public.” As such, these products tend to entice investors to trade on the platform.

If a business provides benefits and promotes sales to encourage the use of a service, it may encourage the use of the service without considering investment risk. This is especially true for cryptocurrencies.

Cryptocurrency advertising, global regulatory concerns

Regulation of virtual currency advertising is a hot topic among regulators. In 2022, the Spanish National Securities Market Commission (CNMV) announced a new regulatory framework addressing advertising.

The rule change stipulates that advertisers and companies seeking to sell digital assets must notify Spain’s watchdog at least 10 days in advance of the nature of their promotional campaigns.

Similar to Thailand’s regulatory framework, s were required to include appropriate risk warnings. The rule changes also included paid advertising by influencers and celebrities. Similarly, the UK’s Financial Conduct Authority (FCA) introduced stricter rules on the promotion of cryptocurrencies in 2023.

Promotional campaigns and s have led to claims of fraud and fraud. In February, Korean influencers and celebrities were involved in a fraud case for allegedly promoting the blockchain sports platform Winnerz without disclosing it.

The most prominent crypto advertising scandal involves the Ethereum Max (EMAX) promotional campaign. In 2022, big celebrities and athletes privately promoted the project on their social media platforms. Most notably, reality TV star and socialite Kim Kardashian received his $250,000 to promote his EMAX to over 320 million followers. .

U.S. regulators charged the TV star with “violating the anti-solicitation provisions of federal securities laws” and fined him $1.2 million. Additionally, the socialite agreed to stop promoting cryptocurrencies for three years and cooperate with the SEC investigation.

At the time of the incident, SEC Chairman Gary Gensler reminded exchanges that promotions must comply with the regulatory framework.

Total crypto market cap is at $2.24 trillion on the weekly chart. source: TOTAL on TradingView

Featured image from Unsplash.com, chart from TradingView.com

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