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Bank subsidiaries’ investments in digital assets to be capped at 3% of capital
17 Sept 23:58 Key points summarised by AI
- The Bank of Thailand (BoT) will cap commercial bank subsidiaries' investments in digital assets at 3% of their capital, effective mid-year, while direct bank involvement in digital asset businesses remains prohibited.
- This 3% limit applies to subsidiaries acting as digital asset exchanges, brokers, or traders, requiring them to pass BoT 'sandbox' tests to ensure robust risk management and governance.
- The BoT may consider easing the 3% cap if subsidiaries demonstrate exceptional efficiency in risk management, good governance, and customer interest protection, emphasizing the separation of these businesses from parent banks.
- In a contrasting move, the central bank removed the 3% investment limit for commercial bank subsidiaries in the Fintech sector, acknowledging their experience and the benefits of such platforms.
- Concurrently, the Securities and Exchange Commission (SEC) issued a new rule prohibiting regulated digital asset operators from using digital assets as a means of payment, aiming to prevent cybercrime, money laundering, and threats to financial stability.
