The Thailand Securities and Exchange Commission (SEC) has approved operating licenses for another four digital assets firms, bringing the total licensed Virtual Assets Service Providers (VASPs) in the country to 21.
According to a report by Thai Inquirer, the four newly approved firms include Krungthai XSpring (KTX) (a broker), T-BOX (an exchange), Coindee (an advisor and fund manager), and Leif Capital Asset Management (a fund manager).
The report noted that despite the licenses, the SEC still needs to inspect the firms’ operations before they can kick off market activities. More firms are awaiting approval, including Binance, which intends to launch “Gulf Binance” in collaboration with local firm Gulf Innova, according to the regulator.
The SEC’s approval of the firms is coming amidst several peculiar circumstances in the Thai digital assets market. The SEC disclosed that enthusiasm among Thai investors has cooled down.
The agency’s data shows that the majority of the existing 2.8 million digital asset accounts recorded in the country are now idle, while the number of exchange accounts has nosedived by 67% so far in 2022. The SEC says this drop is tied to the market meltdown that saw the digital assets market drop from over $2 trillion to around $1 trillion.
Thai exchanges pulling down market enthusiasm
Another challenge facing the Thai digital assets market that the SEC has overlooked is the financial drama playing out with Zipmex, one of the most prominent exchanges in the country.
The SEC is in the middle of investigations into Zipmex for its suspension of withdrawals in July. It has opened an online portal for affected users to file complaints, directed the exchange to resume withdrawals, and submit a report on its assets holdings.
The exchange has explained to users that its investments in Babel Finance and Celsius, which have both run into financial troubles, have forced it to take the action. The company has also filed for a debt relief moratorium in its home country Singapore.
The Zipmex saga has had very little effect on Thai banks that supported the exchange. In a statement, the Bank of Ayudhya said that its exposure to Zipmex through Krungsri Finnovate, one of its subsidiaries, was only 0.0028% of its total AUM.
Previously, the SEC directed digital asset exchange Huobi Global to end its operations in the country after the exchange failed to meet up new regulatory requirements.
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