The Thai Government Makes a Complete U-turn Regarding Crypto Regulation

This week, the Thai government canceled its plans to impose a 15% tax on all of the crypto transactions. The decision comes after negative reactions from some of the top south-east Asian traders.

Why did the Thai government want to restrict crypto payments?

Surprisingly, Thailand has one of the fastest-growing crypto markets worldwide. Over the past couple of years, the country had been heavily affected financially due to pandemic-related restrictions. Meanwhile, the crypto market has been growing astronomically!

Of course, this change has brought the new market to state officials’ attention. According to crypto exchange Upbit’s Chief Executive Pete Peeradej Tanruangporn, the revenue department had a respectful approach:

“The revenue department did a lot of homework and reached out to crypto operators as well to get feedback. It is much more friendly to both investors and the industry.” 

Last week, though, The Bank of Thailand revealed its plans to restrict cryptocurrency payments. Accordingly, their main reason is that paying with crypto “would (generally) not add many benefits to consumers and businesses.”

Some of the crypto community members quickly criticized the decision. For example, the director of policy with Elliptic, a crypto analysis company, David Carlisle, believes all merchants can safely accept crypto payments with “appropriate safeguards in place.”

Crypto taxing and regulation worldwide

Although the crypto market has expanded at the speed of light in 2021, many states have already begun taxing and regulating digital currencies. For example, Indonesia banned crypto trading when it comes to financial institutions.

In addition, Singapore labeled digital assets as “not suitable for the general public.” The Monetary Authority of Singapore also issued new guidelines restricting cryptocurrency trading.

Surprisingly, India took an important step in recognizing cryptocurrencies too. However, this isn’t necessarily good news. The country now imposes a 30% tax on any income generated from crypto transfers – including NFTs. Finance Minister Nirmala Sitharaman confirms an additional 1% tax deduction at source too.

At this moment, crypto is fully banned in 8 countries including Egypt, Qatar, Iraq, Morocco, Oman, Tunisia, Algeria, and Bangladesh. China was the first country to ban crypto transactions in September 2021. This decision forced giant retailer Alibaba, based in China, to stop selling crypto mining machines.