Thailand’s oldest lender, Siam Commercial Bank, has cancelled its plan to acquire a 51% controlling stake in cryptocurrency exchange Bitkub Online for roughly 18 billion baht ($500 million).
The deal to buy a majority stake in Bitkub has been alreday stuck in due diligence more than 10 months since the bid was originally unveiled back in November 2011. The deal had valued Bitkub at more than $1.0 billion, making it the latest unicorn in a country once seen as barren in terms of startups.
Siam Commercial Bank’s SCB X Group cited concerns over Thai regulators’ clampdown on crypto exchanges, including Bitkub. The country’s Securities and Exchange Commission (SEC) orders the cryptocurrency exchange earlier this year to halt accepting new clients until it proves its platform is able to accommodate trading activities of its existing customers.
SEC has also issued improvement orders for Bitkub and other Thai cryptocurrency exchanges after users were blocked from trading during significant price spikes in 2021.
“Whilst the results of the due diligence exercise did not reveal any significant abnormal issues which are irremediable, Bitkub is currently in the process of resolving various issues as per the recommendations and orders of the Securities and Exchange Commission, Thailand, which are uncertain in terms of timeframe in resolving those issues. As a result, the Buyer and the Seller have agreed to terminate the Transaction,” the bank said.
“SCB X Public Company Limited and SCB Securities Co., Ltd. remain committed to their strategic plans to expand into businesses relating to blockchain technology and digital assets, which will play an important role in Thailand’s economy and financial industry,” the statement further reads.
The Southeast Asian nation has already taken steps toward the adoption of cryptocurrencies, rolling out regulations and guidelines to welcome the business and opportunities that blockchain brings.
Last year, Thailand’s securities and exchange commission has published a series of new regulations for crypto businesses, some of which were restrictions that have sparked public outrage. Most recently, it has proposed new guidelines that would govern custody of digital assets held by cryptocurrency operators.
The current rules already require crypto exchanges to share the information of users with regulators, whenever funds are transferred between firms, to curtain a growing number of illicit activities stemming under the guise of the global cryptocurrency industry.
Earlier in 2021, crypto fund managers and investment advisers were also required to apply for a licence to continue their businesses. As things stood before, money managers trading assets that fell outside the legal definition of securities, futures contracts or equivalent financial instruments were not subject to the SEC supervision. Investors in crypto funds managed by unregulated portfolio managers also did not enjoy the protection of investor compensation funds.
