Bangkok, 4 September 2021 – The Securities and Exchange Commission Board (SEC Board) has resolved to propose that Minister of Finance consider revocation of digital asset exchange license of Huobi (Thailand) Co., Ltd. (Huobi), currently named DSDAQ (Thailand) Co., Ltd. Meanwhile, the SEC Board has extended the temporary suspension of digital asset exchange service imposed on Huobi until the license is revoked. In addition, Huobi is required to return all assets to its clients within three months as from the issue date of the SEC Board’s order.
The SEC’s inspection on the
operation of Huobi as a digital asset exchange operator during February 2021 - March 2021 detected deficiencies and
insufficiency in Huobi’s management structure and work systems, causing the
company to fail to operate its business in compliance with the governing
regulations. Therefore, on 19 March 2021, by virtue of Section 35 Paragraph 1 of
the Emergency Decree on Digital Asset Businesses B.E. 2561 (2018) (Emergency Decree), the
SEC Board Meeting No. 5/2564 passed a resolution ordering Huobi to rectify its
work systems, but Huobi failed to do so within deadline. On 1 April 2021, by
virtue of Section 35 Paragraph 2 of the Emergency Decree, the SEC Board Meeting No. 6/2564 passed a resolution ordering Huobi to
suspend its services temporarily and rectify the deficiencies of its work
systems within deadline, and ordering Huobi to return assets to clients as per
their request. Huobi requested extensions of deadline many times and the SEC
Board granted the final extension until 31 August 2021.
However, Huobi still failed to complete the rectification of its work systems within
the specified deadline.
On 2 September 2021, the SEC Board Meeting No. 15/2564 viewed that Huobi had failed to rectify
its work systems to comply with the governing regulations, as ordered even
though the SEC Board granted many deadline extensions to Huobi, as
requested. The total granted rectification
period lasted for five months and 12 days. The key work systems for business
operation that the company failed to rectify were the trading system, the asset
custody system and the information technology system. In this regard, Huobi notified
that the company was in negotiation for procurement of new work systems and
requested further extension of deadline. Nevertheless, no facts appeared to
demonstrate that Huobi would be able to rectify its work systems and ensure
readiness of its personnel in accordance with the governing regulations within
the requested extension of deadline.
Therefore, by virtue of Section 35 Paragraph 3 of the
Emergency Decree and Clause 7 of the Notification of the Ministry of Finance
Re: Licensing of Digital Asset Businesses B.E. 2561 (2018), the SEC Board has
proposed that Minister of Finance consider revocation of the digital asset
exchange license of Huobi. In addition, the SEC Board, by virtue of Section 35 Paragraph
2 of the Emergency Decree, has ordered Huobi to continue suspending its digital
asset exchange service and return assets to the clients or buy assets back from
the clients within three months as from 2 September 2021, the issue date of the
SEC Board’s order. If the clients do not take assets back within deadline, Huobi is required to
deposit the clients’ assets in a secure system.
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