SEC Conducts Public Hearing on the Guideline for Using Digital Assets as Means of Payment for Goods and Services.

Nowadays, consumers and merchants have opened to the use of digital assets as payment for goods or services. To facilitate such actions, the licensed digital asset operators have developed their systems to support payment on transactions made through their platform. This could result in the widespread usage of digital assets for purposes other than investment purposes. The competent authorities are concerned that the use of digital assets as means of payment for goods or services may have certain impact on stability of the country’s economic and financial system, including creating risks to consumers and merchants, for example risk from the fluctuations on value of digital asset, risk of cyber theft, risk of personal data leaking, or risk of being used as a tool for money laundering and should be regulated or monitored at certain level.

The Securities and Exchange Commission has conducted a public hearing on the guidelines for prohibiting licensed digital asset operators from offering services in connection with the use of digital assets for purposes other than investment, such as means of payment for goods and services. The guidelines will apply to all licensed digital asset operators (digital asset exchanges, brokers, dealers, fund managers, and advisers), on transactions involving both types of digital assets (cryptocurrency and digital token). The principle of the guidelines is that the licensed digital asset operators shall not promote or support the use of digital assets as means of payment, which includes the following actions

1. shall not solicit or indicate in any way that implies licensed digital asset operators are supporting payment in digital assets for goods and services.
2. shall not provide any system or tools that would assist merchants in accepting digital assets as payment or customer in using digital assets to pay for goods or services, such as providing a QR code for customers to scan in order to use digital assets as payment for goods or services or providing a system that can show the price of digital assets in cryptocurrency, including providing a system for merchants to exchange digital assets into Thai Baht after receiving payment from customer.
3. shall not open e-wallets for merchants in order to accept digital assets as payment for goods and services.
4. in case where the customer receives Thai Baht as a result of selling digital assets, shall transfer such Thai Baht to such customer’s own account.
5. shall not provide any services relating to the transfer of digital assets between customers for the purpose of accepting digital assets as payment for goods and services.
6. shall not provide any services relating to the transfer of Thai Baht from customers’ account opened with licensed digital asset operators to any third-party account for the purpose of accepting digital assets as payment for goods and services.
7. shall not act in any way that promotes or supports the use of digital assets as means of payment.

The guidelines also specified that if licensed digital asset operators discover that their customers are using the account opened with the licensed digital asset operators for any purpose related to using digital assets as means of payment, the licensed digital asset operators shall a) issue a warning to the customer for using an account in a manner that is inconsistent with the purposes and service conditions set forth by licensed digital asset operators and/or b) consider taking any appropriate action against the customer who violates the service terms and conditions, such as terminating the service or suspending the account.

The guidelines are still in the draft form and has not been enacted. Upon enactment, the regulation will set the effective date. According to the draft guidelines, if licensed digital asset operators entered into any agreements relating to the use of digital assets as means of payment prior to the guideline’s effective date, the licensed digital asset operators shall take all necessary actions to comply with the guidelines within 15 days of the effective date.

The guidelines do not explicitly prohibit the use of digital asset for payment but imposing restriction on the licensed digital asset operators from providing services, soliciting, or promoting their services in facilitating the acceptance of payment in digital assets for goods and services. These restrictions will have impact on merchants and their customers on transactions committed or to be entered through licensed digital asset operators’ platform and merchants should take into consideration of the uncertainty or consequences of transactions potentially affected by this guideline.