KYC to aid cryp­tocur­rency trans­parency


Know Your Cus­tomer (KYC) will be a part of the com­ing reg­u­la­tory frame­work gov­ern­ing cryp­tocur­ren­cies, says the chief of the se­cu­ri­ties watch­dog.

The frame­work must make avail­able the iden­tity of those who make dig­i­tal cur­rency trans­ac­tions, an area in which KYC can help, said Rapee Suchar­i­takul, sec­re­tary-gen­eral of the Se­cu­ri­ties and Ex­change Com­mis­sion.

The reg­u­la­tions must set stan­dards for in­for­ma­tion dis­clo­sure and trans­ac­tion re­port­ing, Mr Rapee said.

Sys­tem se­cu­rity, trans­ac­tion ob­jec­tives and util­i­sa­tion of pro­ceeds aris­ing from ini­tial coin of­fer­ings (ICOs) will also come un­der the reg­u­la­tory frame­work, he said, adding that the work­ing panel must seek a method to iden­tify who is mak­ing vir­tual cur­rency trans­ac­tions other than a do­main name used for trad­ing.

The work­ing panel tasked with con­sid­er­ing po­ten­tial mea­sures to reg­u­late dig­i­tal cur­ren­cies will meet in the next three weeks to con­sider whether the cur­rent laws are suf­fi­cient to reg­u­late cryp­tocur­ren­cies, Mr Rapee said.

The work­ing panel’s mem­bers in­clude rep­re­sen­ta­tives from the Bank of Thai­land, the SEC, the Fi­nance Min­istry and the An­tiMoney Laun­der­ing Of­fice.

Fi­nance Min­is­ter Apisak Tan­tivo­ra­wong said last week that the reg­u­la­tory frame­work would take shape within a month.

Mr Rapee said the SEC is col­lect­ing com­ments from re­cent public hear­ings on a draft bill re­gard­ing ICOs to de­cide what, if any­thing, will be changed. The process will con­clude in the next two months.

Fi­nance per­ma­nent sec­re­tary Somchai Su­j­japongse said the cen­tral bank’s re­cent let­ter to fi­nan­cial in­sti­tu­tions was to ask for, not force, their co­op­er­a­tion.

“The Bank of Thai­land has stud­ied the reg­u­la­tory frame­work for cryp­tocur­rency for a while, and there are many guide­lines but noth­ing has crys­tallised yet,” he said.

In a re­lated de­vel­op­ment, Mr Somchai said the Fi­nance Min­istry will spend 500 mil­lion baht to set up the In­sti­tute for Fi­nan­cial In­no­va­tion and Tech­nol­ogy to de­velop fin­tech.

The min­istry will soon seek cabi­net ap­proval for the bud­get, he said, adding that the in­sti­tu­tion will take re­spon­si­bil­ity for se­lect­ing the ideas of fin­tech and de­vel­op­ing them for com­mer­cial pur­poses.

Separately, Mr Rapee said fin­tech will trans­form the cap­i­tal mar­ket in terms of in­vestor be­hav­iour and busi­ness model, as tech­nol­ogy will help in­vestors ac­cess in­for­ma­tion at a faster pace and at a lower cost.

“Fi­nan­cial reg­u­la­tors will be dis­rupted the most [by fin­tech],” Mr Rapee said, adding that they must change their mind­set and de­mand im­mac­u­late in­for­ma­tion dis­clo­sure.

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