Thai SEC warns against deceptive crypto ads, urging compliance with regulations.
Global regulators, the UK and Spain, have also been cracking down on misleading crypto promotions.
Recent phishing incidents underscore the need for heightened vigilance in ad oversight.
The Securities and Exchange Commission (SEC) of Thailand has initiated measures to combat misleading advertisements in the crypto space, aiming to protect investors from potential losses.
On April 29, the Thai SEC issued a warning to all crypto exchanges operating in the country, cautioning them against the glamourization of cryptocurrency investments in their advertisements. Deputy Secretary-General Anek Yooyuen emphasized the importance of adhering to prescribed advertising standards to prevent investors from being misled.
According to Yooyuen, advertisements in the crypto sector must refrain from containing false, exaggerated, distorted, or concealing information, as such practices violate Thailand’s regulations.
The SEC’s move follows concerns over crypto exchanges enticing users with special privileges, potentially leading them to overlook investment risks.
Upholding investor protection
The SEC emphasized the importance of including appropriate warnings about investment risks in crypto advertisements and cautioned against using special promotions to onboard new users that often encourage individuals to engage in cryptocurrency transactions without fully considering the associated risks.
Blockchain investigation firm Scam Sniffer in its recent report also pointed out the vulnerability stemming from insufficient filtering on advertisement platforms. According to the report, the unfiltered ads expose users to phishing attempts by enticing them to fake websites and prompting them to link their crypto wallets, allowing scammers to withdraw funds without authorization.
Failure to comply with the SEC’s advertising guidelines may result in legal consequences, as violators will face punishment according to the law.
Thai advertising regulations mandate businesses and advertisers to substantiate the facts presented in their marketing campaigns to ensure compliance with the law.
Global crypto regulatory efforts
Thailand’s action mirrors similar steps taken by regulators in other key digital asset markets like the United Kingdom and Spain.
The United Kingdom’s Financial Conduct Authority (FCA) issued hundreds of alerts for illegal cryptocurrency ads in 2023 alone, demonstrating a concerted effort to curb deceptive practices in the industry.
Likewise, Spain’s National Stock Market Commission denounced fraudulent crypto asset promotions in November 2023, underscoring the obligation of companies to comply with local laws.
As Thailand SEC follows in the footsteps of other regulators in regulating the crypto industry, collaboration between regulators and industry stakeholders is crucial to address emerging threats and ensure a safe environment for cryptocurrency investors.
