Digital asset businesses in Thailand get boost with new net capital rules

The securities regulator of Thailand has announced new rules which will allow digital currency businesses to take advantage of digital assets in determining net capital funds, in a move expected to increase liquidity in the sector.

The Securities and Exchange Commission of Thailand has said firms will now be able to factor in any holdings in digital assets following a surge of activity on local exchanges. The new measures have been introduced to support the increase in trading volumes by allowing brokers more flexibility with managing their liquidity.

According to a report in The Bangkok Post, the measures also allow for a deduction based on the quality of the assets held by the firm.

“The maximum amount calculable for digital assets to a firm’s [net capital] is 50% of the asset value.”

Companies operating digital assets services will now be required to maintain at least 1% of digital assets in cold wallets, with at least 5% required to be held in online storage, or hot wallets.

This compares to a current net capital requirement of 7%, and will allow firms to be more liquid in response to changing demands from the market.

The move comes as the latest in a succession of steps taken by the Thai regulator to support the country’s increasing domestic digital currency industry.

In August, the SEC announced it had granted four provisional licenses to South Korean digital currency giants UpBit, giving the firm the necessary permissions to trade in Thailand. In 2019, the regulator also gave approval to SE Digital, a subsidiary of Seamico Securities, which became the first ICO portal licensed to trade in the country.

The new measures come at a time of increasing interest in cryptocurrency and digital assets in Thailand, and throughout the wider region.

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