SEC fears cryptocurrency trading by inexperienced traders
The Securities and Exchange Commission in Thailand is worried about crypto investor ignorance as cryptocurrency trading volume in Thailand surged to 700 to 800 billion baht over the past 10 months. The chief executive of Zipmex Thailand predicted trading will hit 1 trillion baht by the end of 2021.
At the PostToday Cryptocurrency Forum 2021 yesterday the Zipmex executive said that more than 1.1 million people are now trading crypto in Thailand. The SEC worries that crypto trading has now moved beyond more experienced or knowledgable investors and gotten more mass appeal, attracting amateur investors more prone to pitfalls and less aware of the dangers of crypto.
They fear that these inexperienced traders are more susceptible to cryptocurrency scams like copycat digital exchanges created to resemble an official and licensed exchange. Thailand only has 11 legally recognised companies that have the authorisation to facilitate trading services for digital assets like cryptocurrencies.
On top of the risk of scams in the cryptocurrency realm, the SEC worries that new investors and young people are jumping into crypto investment without a strong understanding of investment. Enticed by stories of big jumps in the volatile crypto markets making people rich quickly, people without any investment experience may be jumping in blindly, at risk of losing money.
The SEC warns traders to thoroughly educate themselves on markets and products, and the risks involved before investing in the cryptocurrency market. The assistant secretary-general of the SEC urges people to do their homework.
“We encourage crypto traders to thoroughly check the credibility of a company and study the feasibility of cryptocurrency trading before opening a trading account.”
She reminds people that the investor assumes all responsibility and liability for financial damages and that investing in unauthorised or foreign digital exchanges has no protection in Thailand, where only trades via domestic approved exchanges are allowed.
A UK study found that as many as 45% of new young traders are investing in cryptocurrency using money that was borrowed.
SOURCE: Bangkok Post
