The Thai securities regulator now requires crypto custodians to have a contingency plan in case of unforeseen events.
The Securities and Exchange Commission( SEC) of Thailand is working out to more protect cryptocurrency investors by introducing new rules for crypto custody services.
On Jan. 17, the Thai SEC issued regulations taking virtual asset service providers( VASP) to establish a digital wallet operation system to guarantee effective custody. The new rules target crypto custodians or VASPs that provide crypto storage services.
The regulations include three major requirements, including the provision of policy and guidelines for overseeing the threat operation of digital wallets and private keys. The rules bear VASPs to communicate with regulators regarding similar policies and provide action plans to ensure compliance.
Additionally, the SEC requested crypto custodians provide policies and procedures for designing, developing and managing digital wallets and keys. The authority will also bear crypto custodians to establish a contingency plan in case of unlooked-for events that may affect the wallet operation system.
“ This includes laying out and testing doing procedures, designating responsible persons and reporting the event, ” the SEC stated, adding
“An audit of system security is also required as well as digital forensic investigation in case of any event affecting the security of systems related to digital asset custody, which could cause significant impacts on clients’ assets.”
According to the release, the new regulations have taken effect starting fromJan. 16, 2023. Crypto custodians are needed to completely comply within six months from the effective date.
Related: Binance to let institutions store crypto with cold custody
The rearmost crypto regulations by Thailand’s SEC align with the authority’s plans to borrow further strict crypto regulations in the aftermath of industry failures like the FTX collapse. In early January, the authority reportedly started a new investigation against a original crypto exchange Zipmex, professing that the establishment has been furnishing digital asset fund operation services without authorization.
(HELEN PARTZ, Cointelegraph, 2023)