The Securities and Exchange Commission (SEC) of Thailand has tightened advertisement rules on cryptocurrencies.
The country is the latest to introduce a stiffer regulatory framework on the use of digital assets and how they are marketed in public spaces.
This follows the sell-off of nearly $2tr of digital assets globally, which has sent the markets plummeting.
Speaking on Thursday, SEC said that it is looking to introduce adequate safeguards that enable customers to be protected from pernicious propositions emanating from the cryptocurrency sector.
The new rules are tailored towards instructing crypto businesses to not push their products on retail consumers without fully disclosing the risks.
The change in rules comes after Zipmex briefly froze withdrawals from the cryptocurrency exchange, usually a precursor to deeper problems with a company.
The SEC argued that many of the ads that were shared with retailed consumers failed to fully acknowledge the risk that a consumer would be undertaking. Others even used false information.
For example, the Federal Deposit Insurance Corporation in the US warned big cryptocurrency companies to stop insinuating that anyone who loses their deposit would be covered under federal insurance. Those claims were wrong, the regulator said.
Thailand’s regulator is observing similar trends with cryptocurrency companies often promising unrealistic ROI which then backfires, and many consumers find out that they have lost their funds.
As a result, SEC would expect the advertisement language not to feature, false, misleading, or exaggerated claims.
Risks and warnings about risks must be visible and easily understood. The views featured in the advertisement should be balanced and mention the negative factors. Crypto firms must limit their advertisement to their official channels and websites.
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