The Thai regulator has warned investors of the various risks of DeFi.
Taylan Securities and Exchange Commission asked crypto money investors in the country to be careful about their transactions on DeFi and described DeFi as risky.
The regulator stated that authorities have no control over this industry.
Thailand Regulator Warns
Its regulator said DeFi services, especially deposit taking and loan services, are becoming popular. However, he stressed that these are risky. The following statements were included in the statement:
“…For this reason, investors are advised to examine DeFi projects before investing. Because deposit taking and loan services are not regulated by financial and capital market regulators in Thailand”
In particular, the regulator stated that some information about the terms, conditions and functionality of excessively leveraged collateral may not be fully communicated to investors. Although DeFi platforms promise high returns to investors, there are many risks involved, including the possibility of rug pulls.
The regulator’s warning came after the country’s cryptocurrency exchange, Zipmex, stopped withdrawals on July 21.
The statement also explained that the regulator plans to address digital asset regulatory guidelines, while not supporting DeFi transactions within centralized or decentralized finance.
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