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

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.