Thailand plans to enforce ‘in-person’ KYC for crypto traders

Soon, crypto traders in Thailand will be required to be physically present when facilitating opening an account at any of the many exchanges and wallet providers that operate within the country.

In the Asian region, the country is a small but growing crypto market. In 2021, according to its local Securities and Exchange Commission (SEC), trading volumes ballooned to almost $4 billion, compared to just more than $574 million back in November 2020.

The significant growth is believed to be brought by the now broader demand for cryptocurrencies and the rising market. However, because of the very nature of the crypto space, scams, fraud, and other illicit activities remain.

A drastic dictum for crypto in Thailand

Limited “Know-Your-Customer” (KYC) policies have been enforced in Thailand to try and address the abovementioned problems, but now, a more drastic approach has been taken.

According to reports from local media outlets in the country, crypto exchanges are now obliged to mandatorily verify the identity of their customers with the use of a “dip-chip” machine that requires holders to be physically present.

Such a system is actually being used by gold and jewelry markets, but for crypto traders, the new mandate will take effect in September this year.

Negative impact on Thailand’s crypto market

While it seeks to address problems such as the lingering presence of fraud and other unscrupulous transactions involving crypto, others think that the new system will kill the fast growth of the market in the country.

“Most digital asset exchanges are still busy preparing their systems to accommodate the growing number of clients,” Poramin Insom, founder of local crypto exchange Satang, said, noting this is due to the increase in the number of their clients.

As of April this year, almost 700,000 cryptocurrency traders have accounts on local crypto exchanges. However, Insom pointed out the growth in the number of traders might be negatively impacted if the application process becomes more complicated.

 

Image courtesy of Cointelegraph News/YouTube

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