Thai cryptocurrency exchanges feel the heat from foreign players

It appears that cryptocurrency exchanges in Thailand are feeling threatened by large foreign entrants in digital assets space as the Securities and Exchange Commission (SEC) has been requested to block out international players and safeguard the interests of local businesses.

Whether it is blockchain or cryptocurrency trading, Thailand is gearing up for some severe rivalry from countries like China and others. It is doing everything it can to remain sustainable and profitable. Following Chinese President Xi Jinping strong advocacy for blockchain, the state announced that it is also considering making alterations to its existing cryptocurrency reforms to boost economic growth.

Shut the doors for foreign cryptocurrency exchanges, demand to SEC

Now, Co-founder and Chief executive of a local cryptocurrency exchange, Bitkub Capital Group Holdings, Jirayut Srupsrisopa, has demanded that SEC refuses entry to foreign businesses in cryptocurrency sector as they tend to wipe out local businesses with enhanced technical expertise and a better understanding of the cryptocurrency market, the Bangkok Post reported on 26th November 2019.

Due to relaxed cryptocurrency laws, Thailand has become a hot favourite destination for some of the major cryptocurrency players in the market as the demand for digital assets license continues to increase, said Srupsrisopa. 

Bitkub and Satang Corporation are two such foreign digital assets exchanges that have been granted a license to operate in Thailand. In addition, China’s Huobi and Japanese BiTherb have also been approved for running their businesses out of Thailand; however, they are yet to kick off their operations. Meanwhile, Bitcoin Co ceased its operations earlier this year, to concentrate on other business opportunities.

These foreign players clearly have the edge over domestic businesses, and this could potentially eat away our business, Srupsrisopa explained. 

International crypto businesses are more competitive

According to the Commerce Ministry’s Foreign Business Act of 1999, foreign shareholders cannot own a stake of more than fifty per cent (50%) in Thai companies. This holds for cryptocurrency-related businesses as well. However, the recent announcement of modifying the royal decree, that came into force in May last year, could revise this figure in an attempt to lure in foreign investments in the region.

We fear that the modifications to royal decree could make it potentially easier for foreign players to set up bases in the country. They have the capital and highly developed technology to absorb our share of the market, Srupsrisopa claimed.

Thus, Srupsrisopa believes that restricting their entry is the only way to help local cryptocurrency firms to develop and grow their businesses, thereby strengthening the country’s economy. He also feels it is unfair for the SEC to digital currency exchanges to boost their capital reserves to mitigate risks from trading errors, similar to intermediary companies like securities.

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