Thailand’s SCBX bank scraps 51% stake bid in Bitkub over unresolved regulatory compliance issues
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Siam Commercial Bank (SCBX) has canceled its plan to buy a 51 percent stake in Bitkub, worth an estimated $500 million. The lender made its decision after a due diligence investigation revealed unresolved compliance issues raised against the digital asset exchange by the Thai Securities and Exchange Commission (SEC).
In a press release signed by CEO Arthid Nanwithaya, SCBX stated that while the issues are not unfixable, the uncertain timeline for resolving them was a deal breaker. Termination of the share purchase was mutually agreed upon.
“While the results of the due diligence exercise did not reveal any significant non-remedial anomalies, Bitkub is currently resolving variouslegal and regulatory related issues in accordance with the agency’s recommendations and regulations. [SEC]Thailand, who are uncertain about the timetable for resolving these issues,” according to the release.
SCBX added that it recognizes the potential and capabilities of the exchange and hopes for many opportunities for cooperation in the future. Thailand’s largest bank SCBX launched a takeover bid in November last year through its subsidiary SCB Securities (SCBS).
The move is part of its restructuring from a traditional bank to a wider digital footprint. Despite the Bitkub deal, which would have expanded the bank into the blockchain and digital asset space, SCBX says it remains committed to developing in that direction.
“SCB X Public Company Limited and SCB Securities Co., Ltd. remain committed to their strategic plans to expand business related to blockchain technology and digital assets, which play an important role in the Thai economy and financial sector,” the company said.
SCBX is not new to blockchain and digital assets. It has subsidiary SCB 10X, which operates as a venture capital firm focused on blockchain and digital assets, investing in companies such as Ripple, BlockFi and Alpha Finance.
Bitkub is struggling with Thailand’s digital asset regulations
Bitkub is one of six digital asset exchanges licensed in Thailand. It is also the largest digital asset exchange in the Southeast Asian country, with a market share of over 90% of all digital asset transactions.
However, it has continued to struggle with SEC compliance issues. In May, local news outlet Bangkok Post reported that five members of the exchange’s digital asset selection committee were censured by the SEC’s criminal fines committee for failing to comply with the regulator’s listing rules when it started trading under its original KUB token.
However, the exchange has denied the claim and stated that it met all the criteria set for the securities authority’s digital asset list.
Meanwhile, SCB’s U-turn comes after the Bank of Thailand issued new regulations to restrict commercial banks from investing in digital assets.
See: BSV Global Blockchain Convention Panel, Blockchain for Digital Transformation of Nations
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