SCB Delays Acquisition of Bitkub Due To Strict Crypto Rules

• SCB wanted to have 51% shares in Bitkub
• Strict crypto rules are unfriendly to the crypto market- Nares Laopannarai

The parent company of Siam Commercial Bank wanted to have mass shares in Bitkub but has recently delayed the acquisition. Bitkub is Thailand’s largest cryptocurrency exchange. The step is taken after strict crypto laws which restrict expansion in domestic crypto trading.

SCB X, also known as the mother company of Siam Commercial Bank, wanted 51% shares amounting to $487 million (17.85 billion baht) in Bitkub, Thailand’s largest cryptocurrency exchange. SCB X is the country’s oldest lender.

According to the world’s largest financial newspaper, Nikkei Asia, The bank has to delay the most special deal because of the strict crypto rules in Thailand, which restrict the expansion of crypto trading domestically. 

A senior officer at SCB X said that “We have given our statement to the Stock Exchange of Thailand, and it is clear in it that the deal is still going through because of our careful and persistent hard work, but we can’t confirm the dates of closing the deal.” 

At the beginning of July 2022, the company sent a notice to the Stock Exchange of Thailand stating that the completion period of the deal had been increased. However, the subject is still in discussion with governmental bodies.

The actual reason for delaying

In November 2021, SCB X publicized holding shares in Bitkub. To become a regional fintech player, the strategist made this plan. Firstly, It was believed to close the deal within the first four months of this year when the value of Bitkub stood at 35 billion baht ($1.05 billion), and the transaction underwent brokerage subsidiary SCB securities.

But in February 2022, the bank of Thailand and the Securities and Exchange Commission (SEC) came up with more strict rules for cryptocurrency, which delayed the deal.

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According to the new rules, the use of payments was limited, and the trade was only allowed with licensed platforms in Thailand. On the other hand, a dip in the crypto market left people in doubt that Bitkub will be able to influence customers.

Nares Laopannarai, the secretary general of the Thai digital asset association, gave an interview to Nikkei and said:

“In my view, the strict rules are very unfriendly to the crypto industry, as it limits the expansion of crypto trading. This is not what we expected” 

Conclusion

Due to strict regulations in Thailand, Bitkub wants to relocate to Vietnam and has tried relocation. Somehow the strict rules are good for security purposes, but the secretary general of the Thai digital asset association finds it unfriendly.

Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.

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