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EDITORIAL: Where doubt lingers, risk has to be reduced


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Where doubt lingers, risk has to be reduced

By The Nation

 

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With bogus claims abounding, the SEC is right to keep a tight rein on investments in digital assets 

 

To protect the investing public’s interests, the Securities and Exchange Commission (SEC) has stepped up its surveillance and preventive measures against unauthorised or bogus investment schemes, especially those concerning digital assets.

 

The latest warning was issued earlier this week after DB Hold Plc publicly announced on the social media its unauthorised offering of digital tokens worth about Bt500 million. 

 

The SEC had earlier publicly cautioned against putting money into investment contracts issued by Ronghui International Services, because the regulatory body had not approved its offering.

 

Investment scams, especially those related to popular crypto-currencies such as Bitcoin and other digital assets, have made news headlines recently. 

 

In one example, the Finnish owner of Bitcoins worth nearly Bt800 million complained to Thai police that a group of Thais had cheated him by luring him into transferring the cryto-currency into their bank accounts for further investments in Thai stocks and other assets. They ultimately failed to do so. Another cross-border investment scam led to a combined loss of more than Bt200 million invested by Thais and foreigners who were talked into putting their money in bogus contracts issued by Eagle Gates Group, which was registered in the US but was not a genuine business.

 

Overall, investors need to exercise caution when considering putting their money into investment schemes, including those involving digital assets. 

 

Old-fashioned Ponzi investment schemes are still around, as evidenced by the exposure of Eagle Gates Group.  However, the more complicated forms of investment are those involving digital tokens and cryto-currencies such as bitcoin.

 

At present, the SEC is empowered to regulate the issuing and trading of all digital assets. It has listed seven operators currently allowed to do business in digital assets on a temporary basis. For the trading of Bitcoin and other cryto-currencies, five are temporarily permitted, namely, Bitcoin Co, Bitkub Co, Cash2coin, Satang Corp (TDAX) and Coin Asset. In addition, Coins TH and Digital Coin (ThaiWM) are allowed to be dealers. 

 

The SEC is in the process of obtaining approval from the Finance Ministry to grant licences to these seven operators.

 

As a result, all investors are urged to check if they are dealing with authorised operators when considering a move into digital assets.

 

In the case of DB Hold, for example, there were advertisements on social media platforms persuading the public to invest in Bt500 million worth of digital tokens. 

 

The claiming was that the funds would be then invested in various projects, such as digital platforms for the exchange of goods and services using so-called DB tokens. 

 

The unauthorised offering also cited a planned investment in blockchain technology, so the SEC told the firm to stop promoting its offering.

 

At this stage, no firm has been authorised by the SEC to issue digital tokens in the Thai market. The authorities are formulating a proper framework to regulate the new form of investment involving the use of digital assets as well as crytro-units and blockchain technology, which have the potential to disrupt the way we invest.

 

Source: http://www.nationmultimedia.com/detail/opinion/30352855

 
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-- © Copyright The Nation 2018-08-24
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