Thailand's securities and exchange commision issues new cryptocurrency advertising rules

Thailand's Office of Securities and Exchange Commission "SEC" has issued an amendment to the advertising regulations of digital asset business operators.

The regulations are to increase efficiency in overseeing the business operators' advertising for it to be clearer in nature and comply with foreign regulatory rules. This will in turn, increase protection for digital asset traders. The rules come into effect from 1 September 1 2022. Advertisers have 30 days to make changes.

Currently, digital asset operators are advertising through various channels, and the SEC has found specific problems from their digital advertising; such as the lack of warnings about the risks of cryptocurrencies, high volatility or limited warnings -  including advertising content that only shows positive information.  Therefore, the advertisements may persuade people to use the service or trade of cryptocurrencies, without considering the information and risks accordingly before making decisions that can lead them to a loss.

The SEC has issued an announcement to improve the regulations for advertising and promotion of digital asset business operators - in accordance with the SEC's principles mentioned in the meetings on 3 February 2022 and 5 May 2022 and received recommendations from the relevant parties for improvements. In order to increase the effectiveness, appropriation and clearer regulations in supervising advertisements, that's in line with foreign regulations and to increase protection for traders, the important keys are as listed:

(1) Advertising must not be false, exaggerated, distorted and misrepresented. It must provide information about the number of customers using the service and strictly specify the number of customers who have been authorised to open an account and are ready to use the service.

(2) Business operators who wish to provide advertisements are required to provide details about advertising and its costs, the details include the employment of those who benefit from the services of bloggers or influencers, in accordance with SEC's regulations, methods, conditions and time duration.

(3) Regulations must have information and warnings on investment risks in the advertisements. The format of the presentation must be clear and noticeable. The operator must present complete information that is useful for investment decisions, in a balanced manner - whether there is positive information or an opportunity to gain returns - or negative information or risks associated with investing in digital assets must be displayed in parallel.

(4) Regulations for the advertisement of cryptocurrencies can only be done via the operators' official channels, in order to prevent the advertising of cryptocurrencies to reach a wide range of people, which are highly volatile products and prevent impulsive buying, while advertising about the operators' services can still be done in public spaces and other channels.

(5) Regulations require the business operators to manage the advertisers or the providers of advertising for business operators, including companies in the groups, persons who are involved in the business and who are in the main roles who appear in the ads to comply with the regulations.

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