Thailand Mandates Physical ID Checks of Crypto Investors
- The AML law will come into effect from July.
The Thailand government is making the regulations around crypto exchanges more strict as it mandated the verification of customer identities using a ‘dip-chip’ machine, which requires the physical presence of the clients. These machines are used for ID verifications across gold shops in the country.
Bangkok Post reported on Monday that the new rules around the anti- Money Laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laundered through financial institutions each year.This is not entirely surprising given the structure of the financial services industry and the nature of products and services offered by its participants.An ecosystem that involves the management, control, and processing of finances is inherently vulnerable to abuse by money launderers.Money Laundering ExplainedThe act of laundering is committed in circumstances in which an individual or entity is engaged in an arrangement that involves the proceeds of crime. These arrangements include a wide range of business relationships, i.e. banking, fiduciary and investment management.However, the degree of knowledge or suspicion will depend upon the specific offense but will usually be present where the person providing the arrangement, service or product knows, suspects or has reasonable grounds to suspect that the property involved in the arrangement represents the proceeds of crime. In some cases, the offence may also be committed where a person knows or suspects that the person with whom he or she is dealing is engaged in or has benefited from criminal conduct.One of the primary criticisms against cryptocurrencies has been their propensity for money laundering. Their anonymous nature and unregulated network structure make them ideally suited for money launders. Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laundered through financial institutions each year.This is not entirely surprising given the structure of the financial services industry and the nature of products and services offered by its participants.An ecosystem that involves the management, control, and processing of finances is inherently vulnerable to abuse by money launderers.Money Laundering ExplainedThe act of laundering is committed in circumstances in which an individual or entity is engaged in an arrangement that involves the proceeds of crime. These arrangements include a wide range of business relationships, i.e. banking, fiduciary and investment management.However, the degree of knowledge or suspicion will depend upon the specific offense but will usually be present where the person providing the arrangement, service or product knows, suspects or has reasonable grounds to suspect that the property involved in the arrangement represents the proceeds of crime. In some cases, the offence may also be committed where a person knows or suspects that the person with whom he or she is dealing is engaged in or has benefited from criminal conduct.One of the primary criticisms against cryptocurrencies has been their propensity for money laundering. Their anonymous nature and unregulated network structure make them ideally suited for money launders. Read this Term practices of the crypto exchanges will come into effect in July. The rules might slow down the onboarding process on Thai crypto exchanges from the second half of this year.
“Most digital asset exchanges are still busy preparing their systems to accommodate the growing number of clients as new account applications continue to flow in,” said Poramin Insom, Co-Founder and Director of Satang Corp.
“However, this growth may be curbed if the application process becomes more complicated.”
Tough to Manually Check So Many Client IDs
The crypto exchanges rely heavily on automation for the entire onboarding process and such new AML rules will become a massive hurdle. The digital asset intermediaries in the country are now planning to discuss the issue at a forum and prepare questions for discussions with the government agencies.
The country already has many AML regulations around cryptocurrency purchases. The exchanges need to report any transaction worth over 1.8 million baht under the existing money laundering law and have to maintain databases for inspections.
Recently, the financial markets regulator of the country proposed some harsh laws based on the income group, which potentially blocked a majority of the Thai population from investing in cryptocurrencies. However, massive backlash forced the regulator to take back the draft.
Meanwhile, the country is fighting with the circulation of stablecoins, which, according to the Thai central bank, violates the country’s currency act.
The Thailand government is making the regulations around crypto exchanges more strict as it mandated the verification of customer identities using a ‘dip-chip’ machine, which requires the physical presence of the clients. These machines are used for ID verifications across gold shops in the country.
Bangkok Post reported on Monday that the new rules around the anti- Money Laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laundered through financial institutions each year.This is not entirely surprising given the structure of the financial services industry and the nature of products and services offered by its participants.An ecosystem that involves the management, control, and processing of finances is inherently vulnerable to abuse by money launderers.Money Laundering ExplainedThe act of laundering is committed in circumstances in which an individual or entity is engaged in an arrangement that involves the proceeds of crime. These arrangements include a wide range of business relationships, i.e. banking, fiduciary and investment management.However, the degree of knowledge or suspicion will depend upon the specific offense but will usually be present where the person providing the arrangement, service or product knows, suspects or has reasonable grounds to suspect that the property involved in the arrangement represents the proceeds of crime. In some cases, the offence may also be committed where a person knows or suspects that the person with whom he or she is dealing is engaged in or has benefited from criminal conduct.One of the primary criticisms against cryptocurrencies has been their propensity for money laundering. Their anonymous nature and unregulated network structure make them ideally suited for money launders. Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laundered through financial institutions each year.This is not entirely surprising given the structure of the financial services industry and the nature of products and services offered by its participants.An ecosystem that involves the management, control, and processing of finances is inherently vulnerable to abuse by money launderers.Money Laundering ExplainedThe act of laundering is committed in circumstances in which an individual or entity is engaged in an arrangement that involves the proceeds of crime. These arrangements include a wide range of business relationships, i.e. banking, fiduciary and investment management.However, the degree of knowledge or suspicion will depend upon the specific offense but will usually be present where the person providing the arrangement, service or product knows, suspects or has reasonable grounds to suspect that the property involved in the arrangement represents the proceeds of crime. In some cases, the offence may also be committed where a person knows or suspects that the person with whom he or she is dealing is engaged in or has benefited from criminal conduct.One of the primary criticisms against cryptocurrencies has been their propensity for money laundering. Their anonymous nature and unregulated network structure make them ideally suited for money launders. Read this Term practices of the crypto exchanges will come into effect in July. The rules might slow down the onboarding process on Thai crypto exchanges from the second half of this year.
“Most digital asset exchanges are still busy preparing their systems to accommodate the growing number of clients as new account applications continue to flow in,” said Poramin Insom, Co-Founder and Director of Satang Corp.
“However, this growth may be curbed if the application process becomes more complicated.”
Tough to Manually Check So Many Client IDs
The crypto exchanges rely heavily on automation for the entire onboarding process and such new AML rules will become a massive hurdle. The digital asset intermediaries in the country are now planning to discuss the issue at a forum and prepare questions for discussions with the government agencies.
The country already has many AML regulations around cryptocurrency purchases. The exchanges need to report any transaction worth over 1.8 million baht under the existing money laundering law and have to maintain databases for inspections.
Recently, the financial markets regulator of the country proposed some harsh laws based on the income group, which potentially blocked a majority of the Thai population from investing in cryptocurrencies. However, massive backlash forced the regulator to take back the draft.
Meanwhile, the country is fighting with the circulation of stablecoins, which, according to the Thai central bank, violates the country’s currency act.