Thailand’s Securities and Exchange Commission has temporarily suspended the services of the local branch of crypto exchange Houbi and recommended revoking its operating license with the Ministry of Finance. With the suspension in place, Huobi has been given three months to return all assets to its clients.
Huobi, which is branded as DSDack in Thailand, received the suspension order after failing to comply with local regulations related to its operations and management structure.
According to the Thai SEC, Huobi was first informed about a breach of compliance during an investigation that started in February 2021. After its reported failure to meet the regulatory requirements set by the authorities, Huobi had been given an extension until the end of August 2021 based on the exchange’s request.
Despite a total extension of five months and 12 days, the SEC ruled Huobi’s trading systems, customer asset retention systems and information technology systems as “irreparable” and has given the exchange three months from Thursday, Sept. 2, to return all assets to its Thai-based customers and clients.
Additionally, the SEC has asked Huobi to provide a security deposit for customers if it fails to return all assets within the stipulated time.
A spokesperson from Huobi Global told Cointelegraph: "Huobi Thailand is based on the original Huobi Cloud Thailand project built by Huobi Cloud and its local Thai partner G.L.T. Huobi Cloud provides only technical product support and brand authorization. The current brand authorization and technical service contracts with Huobi Thailand have expired, and Huobi Cloud will no longer provide support for this project in the future."
Related: Thai SEC bans exchanges from handling certain token types including NFTs
While Thailand has allowed citizens to indulge in crypto investments, the Thai SEC has been issuing regular guidelines to crypto exchanges to dampen the perceived risks associated with trading crypto.
Back in June 2021, the SEC issued a rule that prohibited crypto exchanges from hosting meme-based tokens, fan-based tokens, nonfungible tokens and exchange-issued tokens. The SEC also required all coins on the exchange to adhere to the capabilities as mentioned in their respective white papers.
The Thai SEC has also proposed a new framework that prohibits crypto companies from using investors’ assets for any business or personal benefits.