The Thailand Securities and Exchange Commission (SEC) has issued a consultation paper seeking industry feedback on proposed amendments to its digital asset custody rules.
These will prevent custodians from using a client’s assets for the benefit of other clients or parties, and will impose an obligation on the custodian to reconcile client assets on a daily basis to ensure accuracy of books and records.
This requirement will apply to digital assets and to custody of fiat money. Custodians will not be permitted to gain benefit from holding a client’s fiat money, apart from earning interest income on a client’s fiat money that is held in deposit.
The proposed changes state that “in the case of digital assets, seeking benefits for clients shall be prohibited” — implying that custodians may not generate revenue for their clients by lending digital assets or by other means.
The new rules will require custodians to apply a multi-signature approvals process to fiat money withdrawals and to apply similar checks and balances to those applicable for digital assets.
Respondents are asked to provide feedback on the consultation paper by 22 September 2021.
Service providers will be expected to be compliant with these additional regulations within one month of their taking effect.
