Thailand Securities and Exchange Commission (SEC) warns exchanges against publishing misleading advertisements

Thailand’s Securities and Exchange Commission (SEC) has issued a warning against digital asset platforms for cryptocurrency promotion and misleading advertising. According to local reports, these platforms must be careful with their advertising and focus on benefiting investors.

The warning comes amid growing concerns about cryptocurrency-related online scams and is part of the regulator's efforts to tighten oversight of the country's cryptocurrency market.

Exchange advertisements must comply with Regulatory Rules

Thailand’s Securities and Exchange Commission (SEC) recently launched a new round of crackdowns on the country’s cryptocurrency industry, the Bangkok Post reported on Monday. The report pointed out that Thailand’s regulatory agencies have issued warnings to digital asset exchanges, asking them to exercise caution in their operations.

The Securities and Exchange Commission of Thailand (SEC) has issued a warning to digital asset trading platforms, stating that these platforms must be careful when conducting advertising and organizing introducing broker agent (IBA) activities, as these activities may violate regulations established by the SEC. rule

Crypto exchanges must comply with the country’s regulatory business standards to operate and focus on benefiting investors. All advertising and sales promotion must subsequently be free of false, exaggerated, distorted, concealed or misleading information.

Additionally, advertising and promotions need to warn investors about the risks of crypto investing. The regulatory framework also requires promotions to “not rush” customers to decide whether to use the exchange to invest in digital assets.

The SEC noted that IBA can only promote digital token services to “avoid speculation in cryptocurrencies as high-risk assets.”

Anek Yooyuen, deputy secretary-general of the Securities and Exchange Commission of Thailand (SEC), mentioned that exchanges generally adopt a strategy of providing some special preferential conditions to the public to attract investors to trade on their platforms. This practice includes, but is not limited to, providing transaction fee reductions, transaction rewards, or other forms of incentives.

When cryptocurrency exchanges organize sales promotions and offer incentives to entice users to use their services, this practice may prompt people to invest without fully considering the investment risks, especially when it comes to high-risk assets such as cryptocurrencies in the case of.

Global regulators focus on crypto advertising

The regulation of cryptocurrency advertising has always been a matter of great concern to various regulatory agencies. In 2022, Spain’s National Securities Market Commission (CNMV) introduced a new regulatory framework to address this issue.

By introducing such a regulatory framework, CNMV hopes to better regulate the advertising and promotion of cryptocurrency, reduce fraudulent and misleading behaviors, protect the interests of investors, and promote the healthy development of the market. This move also reflects the global emphasis and trend on cryptocurrency advertising regulation.

The rule changes require advertisers and companies seeking to market digital assets to report the content of their promotions to Spanish regulators at least ten days in advance.

Similar to Thailand’s regulatory framework, when Spain updated its regulatory rules for digital asset advertising, it also emphasized that advertising content must contain appropriate risk warnings to ensure that investors can clearly understand the risks that may be faced by investing in digital assets.

Likewise, the UK’s Financial Conduct Authority (FCA) plans to implement stricter rules to regulate cryptocurrency promotions in 2023.

The advertising and promotions have led to a series of accusations of scams and fraud. In February this year, some South Korean internet celebrities and celebrities were involved in a fraud case for allegedly promoting the blockchain sports platform Winnerz without proper information disclosure.

The most high-profile cryptocurrency advertising scandal involves the promotion of EthereumMax (EMAX). In 2022, a number of big-name celebrities and athletes promoted the project through their social media platforms without public disclosure.

Most notably, reality TV star and socialite Kim Kardashian received $250,000 to promote Ethereum Max (EMAX) to her over 320 million first-timers. Kim Kardashian received $250,000 to promote EMAX to her more than 320 million followers.

U.S. regulators accused the TV star of violating anti-peddling provisions of federal securities laws, resulting in her being fined $1.2 million. Additionally, the socialite agreed to cease promoting cryptocurrencies for the next three years and cooperate with investigations by the U.S. Securities and Exchange Commission (SEC).

At the time of the incident, SEC Chairman Gary Gensler issued a reminder to the exchange, emphasizing that all promotional activities must comply with the regulatory framework.

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