Avoid unlicensed crypto exchanges, Thai SEC tells public

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The chief financial regulator of Thailand has warned investors to avoid the unregulated Q Exchange, following an order issued to the firm to stop advertising on account of a lack of a sufficient license.

The Thai Securities and Exchange Commission (SEC) took the unprecedented step of recommending investors do not trade with the local cryptocurrency exchange, which does not hold a license as a “digital business operator,” ahead of a new licensing regime expected to take effect with initial exchanges from the end of November.

In a notice on its website, the SEC stated: “The SEC would like to inform the public that Q Exchange Co Ltd is not a licensed digital business operator…The public and investors should be cautious in engaging in digital asset and electronic money trades with this firm because such actions might not be lawfully protected by the SEC.”

The Q Exchange is a crypto exchange offering customers the opportunity to trade in 10 cryptocurrencies, including BTC and ETH. The exchange also had plans to launch its own cryptocurrency, the Q Token, according to local media reports.

After a royal decree issued back in May, cryptocurrency businesses in Thailand were required to register with local authorities, and to obtain the permission of regulators before engaging in the crypto sector. The measures cover cryptocurrency exchanges, as well as those promoting or engaging in initial coin offerings (ICOs).

The first licensed platforms are expected to appear this month. While no online presence for Q Exchange could be detected, the warning from the SEC suggests the exchange was seeking to trade without the required permission or licence from the Thai regulator.

Thailand has previously been regarded as one of the stricter jurisdictions, after measures introduced earlier this year to exert greater state control over cryptocurrency and related businesses.

With more formal regulation for exchanges and other crypto businesses expected to take effect in due course, it now presents an opportunity for those courting institutional businesses to operate within the Thai market.

It follows calls from the sector to introduce stricter regulation, as part of a drive to cement legal certainty for legitimate exchange operators.

As for exchanges like Q Exchange, which still remain outside of the licensing regime, it looks like the days of regulation-free trading are already numbered.