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Thailand’s SEC Intensifies Action Against Misleading Cryptocurrency Advertisements

ByDayne Lee

May 5, 2024
Thailand's SEC Intensifies Action Against Misleading Cryptocurrency Advertisements

Thailand’s SEC Intensifies Action Against Misleading Cryptocurrency Advertisements

The Thai Securities and Exchange Commission (SEC) is intensifying its efforts to safeguard investors from misleading cryptocurrency advertisements. In a recent move, the regulator has issued a stark warning to all operating crypto exchanges within the country, urging them to adhere strictly to established advertising standards to prevent investor deception.

Regulatory Concerns and Warnings

Deputy Secretary-General Anek Yooyuen expressed the SEC’s concerns about crypto exchanges potentially glamorizing investment opportunities in the digital asset space. He emphasized that advertisements that portray false, exaggerated, or distorted information, or those that conceal or mislead, are in direct violation of Thailand’s stringent advertising regulations.

This initiative by the Thai SEC mirrors actions taken by regulators in other major crypto markets aimed at minimizing the financial risks for investors. For instance, the United Kingdom’s Financial Conduct Authority (FCA) issued 450 alerts concerning illegal crypto advertisements in 2023, and Spain’s National Stock Market Commission has been actively policing fraudulent crypto promotions on social media platforms.

Guidelines and Enforcement

The Thai SEC’s guidelines mandate that crypto exchanges include clear warnings about investment risks in their advertisements and avoid using special promotions to attract new users. Yooyuen highlighted the dangers of promotions that offer rewards, which could tempt users to engage with services without adequately considering the associated investment risks.

Violations of these guidelines are subject to stringent legal actions. The Thai regulatory framework requires advertisers to substantiate the claims made in their marketing campaigns, with failure to do so potentially resulting in legal repercussions.

The issue of misleading crypto advertisements is part of a broader concern about online security within the cryptocurrency ecosystem. For example, a recent incident involved hackers taking over advertisements on the blockchain explorer Etherscan, redirecting users to phishing sites designed to drain crypto wallets.

Blockchain investigation firm Scam Sniffer pointed out that the root cause of this large-scale phishing campaign might be the lack of adequate oversight by advertisement aggregators, which failed to filter out malicious ads effectively.

Consequences and Recommendations

The SEC’s crackdown is aimed at ensuring that the burgeoning crypto market remains a safe investment avenue for both seasoned and new investors. By enforcing stricter advertising guidelines, the Thai SEC hopes to foster a more transparent and reliable digital asset market.

Experts suggest that crypto exchanges and other digital asset service providers intensify their internal review processes and collaborate more closely with regulatory bodies to align their operational practices with legal standards and investor protection mechanisms.

As the cryptocurrency landscape continues to evolve, regulatory bodies like Thailand’s SEC are crucial in shaping a safer investment environment. By addressing misleading advertisements and enforcing strict compliance, the SEC not only protects investors but also contributes to the overall stability and credibility of the financial market.

Featured image credit: R J Mac via PlasBit

Dayne Lee

With a foundation in financial day trading, I transitioned to my current role as an editor, where I prioritize accuracy and reader engagement in our content. I excel in collaborating with writers to ensure top-quality news coverage. This shift from finance to journalism has been both challenging and rewarding, driving my commitment to editorial excellence.

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