Thailand’s Securities and Exchange Commission is taking a hard stance against NFTs by issuing a ban against NFT Trading. The new ordinance covers new digital asset market regulations that specifically prohibit the trading of cryptocurrencies using NFTs. In fact, they even banned the trading of Meme Coins like DogeCoin and Shiba on digital asset exchanges.
Understanding Thailand’s Move to Ban NFT Trading
According to reports, the regulators enacted the new ruling when a J-Mart Group company launched its first NFT aimed at promoting an ecosystem centered on its digital coin, JFin.
To recap, last June, the Thai SEC has banned crypto exchanges in the country from trading in certain types of tokens. This includes meme tokens, fan tokens, NFTs, as well as exchange-issued tokens. Back then, SET-listed Jay Mart was on the verge of launching Thailand’s first NFT Collection featuring nine celebrities. Eventually, they pushed through with the launch and listed the NFTs on foreign exchanges.
The new Thailand rules cover everything from sports goods to NFTs. This represents the rights to physical luxury items such as watches and real estate. SEC Secretary-General Ruenvadee Suwanmongkol further stated that the ban extends to digital currencies with one or more of these characteristics:
- Symbolized by an influencers fame
- Unique and cannot be redeemed for the same amount of digital tokens of the same category and type.
- A digital token is used in blockchain transactions and issued by digital asset exchanges or stakeholders.
Analyzing what Triggered the NFT Ban
According to speculations, the leading reason for the ban is recurring digital asset-related scams. Between rug-pulls and hacking incidents, the crypto and NFT Market seems to be a hot target for scammers. Just last week, we reported that Babadeda malware is scamming users by impersonating OpenSea, BAYC, and ZED RUN marketplace accounts.
Another possible reason why SEC has banned NFTs is the unrealistic valuation of these digital assets. Abstract NFTs such as Collectibles are still selling for thousands of dollars. Yes, users have full discretion on how they want to use their funds. However, it is still the SEC’s responsibility to protect users from massive devaluations, especially because some NFTs are highly speculative in nature.
The ruling also argues that if the issuer does not own the IP of the NFT, then that property is virtually meaningless.
Moreover, the SEC did not ban the issuance of NFTs, only the trading of these digital assets. With new projects and platforms launching left and right, NFTs are not going anywhere. So let’s see if regulators will eventually relax policies related to NFTs as adoption continues to grow.
Thailand’s NFT Landscape
NFT Projects are also on the rise in Thailand. Last month. Metaverse Thailand kicked off its first land sale. With this, users bought from an actual map in the heart of Bangkok and became landowners in the Ekkamai area. Prior to that, the Miss Universe Thailand competition also incorporated NFTs in the beauty pageant.