Thailand’s Former SEC Chief Opposes Possible Crypto Taxation: Report

Tipsuda Thavaramara – former Deputy Secretary-General of Thailand’s Securities and Exchange Commission (SEC) – disagreed with the government’s intentions to impose a 15% capital gains tax on cryptocurrency profits. She believes such legislation is unpractical, unfair, and not beneficial for the trade sector.

The Bill Lacks Clarity

Earlier this month, the Thai authorities presented plans to slam local cryptocurrency investors and miners with a 15% capital gains tax. According to the legislation, digital asset exchanges would be exempt from the potential regulations. Nonetheless, the lawmakers did not elaborate, making some individuals doubt the use-cases.

One of them is Tipsuda Thavaramara – a former top executive at Thailand’s SEC. In her view, the possible crypto taxation lacks clarity and is not going to promote trade:

“Withholding tax also affects transactions as stores that accept cryptocurrencies must collect capital gains tax from customers.”

She went further stating that the Revenue Department’s decision is “unfair and unpractical” as crypto exchange operators do not pay investment returns to users:

“Whether policies focus on the promotion of trade industry or not, the Revenue Department should collect taxes fairly under clear rules and practices.”

Thavaramara noted that countries like Singapore, Australia, and some European nations do not treat cryptocurrencies as a product and have removed the value-added tax (VAT) on trading. She urged Thailand’s authorities to follow that path.


Tipsuda Thavaramara
Tipsuda Thavaramara, Source: The Bangkok Post

Thailand’s Crypto Plans for 2022

At the end of 2021, the Bank of Thailand (BoT) unveiled plans to implement strict rules on the cryptocurrency industry in 2022 as the interest in the asset class keeps increasing.

The exact rules, which the BoT intends to propose are yet unknown. Still, the bank’s Governor – Mr. Suthiwartnarueput – said bitcoin and the alternative coins have the potential to prosper in the monetary system. Like many others, though, he warned that the enhanced volatility of the asset class remains an issue.

Prior to this, the central bank of Thailand urged local financial institutions to stay away from cryptocurrencies:

“We don’t want banks to be directly involved in digital asset trading because banks are responsible for customer deposits and the public, and there is a risk.”

The BoT was also concerned that the broad employment of digital assets could impact the central bank’s ability to monitor the national economy.


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Binance Burns $792M in BNB

Key Takeaways

  • Binance has executed its 18th quarterly coin burn, reducing the supply of its Binance Coin (BNB) token.
  • This most recent burn used a new “Auto-Burn” system to determine the amount of coins to be destroyed.
  • The price of BNB has been only moderately affected in the hours following the coin burn after prices began at $471.

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Binance has carried out its 18th coin burn, reducing the supply of its Binance Coin (BNB) by 1.68 million.

Binance Burns 1.68 Million BNB

On Monday, Jan. 17, Binance said that it had burned over 1.68 million BNB, an amount worth approximately $792 million at current market prices.

Binance reminded users that it has committed to removing half of the total supply of BNB from circulation, or 100 million of the 200 million tokens that initially made up the supply. Today’s burn represents an amount equal to 0.84% of Binance’s initial supply.

Coin burns such as this one are meant to reduce the supply of a cryptocurrency and keep prices reasonably high by creating more demand for the tokens already in circulation. Burns are carried out by sending tokens to an inactive address.

This coin burn is the 18th quarterly burn since Binance began to undertake the practice beginning in 2017.

New Auto-Burn Model

This quarter’s burn was also the first to use a new “Auto-Burn” formula, which automatically calculates the burn amount on market prices and the number of blocks produced by Binance Smart Chain.

This new model is meant to be more objective than the previous one. Binance CEO Changpeng Zhao said that the new model will provide “greater autonomy, transparency, and predictability.” The new model was decided upon after feedback from the community.

Previously, Binance says, burn amounts were decided based on the usage of BNB and revenue generated by Binance’s exchange. BNB’s last quarterly burn, its 17th, accounted for the removal of 1.34 million BNB from circulation. Other burns have ranged in size from 808,000 BNB to 3.6 million BNB.

Prices Only Affected Moderately

News of the coin burn has had only a very moderate effect on BNB prices so far. Binance performed the transaction for the burn at 08:14 a.m. PST on Jan. 17, when BNB was priced at $471.

The price of BNB briefly rose to $478 at 12:00 p.m. PST, representing a price increase of approximately 1.5%. At press time, BNB was trading at $474. It is possible that prices will be affected more significantly in the long term as trading continues to take place.

Binance Coin (BNB) is currently the third-largest cryptocurrency on the market, with a capitalization of $78 billion.

Disclosure: At the time of writing, the author of this piece owned BTC, ETH, and other cryptocurrencies. 

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Bitcoin price can’t find its footing, but BTC fundamentals inspire confidence in traders

Bitcoin’s (BTC) sudden crash on Jan. 10 caused the price to trade below $40,000 for the first time in 110 days and this was a wake-up call to leveraged traders. $1.9 billion worth of long (buy) futures contracts were liquidated that week, causing the morale among traders to plunge.

The crypto “Fear & Greed” index, which ranges from 0 “extreme fear” to 100 “greed” reached 10 on Jan. 10, the lowest level it has been since the Mar. 2020 crash. The indicator measures traders’ sentiment using historical volatility, market momentum, volume, Bitcoin dominance and social media.

As usual, the panic turned out to be a buying opportunity because the total crypto market capitalization rose by 13.5%, going from a $1.85 trillion bottom to $2.1 trillion in less than three days.

Currently, investors seem to be digesting this week’s economic data that shows United States December 2021 retail sales going down by 1.9% compared to the previous month.

Investors have reason to worry about stagflation, a scenario where inflation accelerates despite the lack of economic growth. However, even if this eventually proves that Bitcoin’s digital scarcity is a positive characteristic, markets will still take shelter with whatever asset is deemed safe. Thus, the first wave will potentially be damaging for cryptocurrencies.

Top weekly winners and losers on Jan. 17. Source: Nomics

Bitcoin price was flat over the past seven days, effectively underperforming the altcoin market’s 7% gain. Part of this unusual movement can be explained by layer-1 decentralized applications platforms showing a positive performance that was driven by Fantom (FTM), Cardano (ADA), Near Protocol (NEAR) and Harmony (ONE).

Loopring (LRC), a zkRollup open protocol for decentralized exchanges on Ethereum, presented the worst performance of the week. The DEX volume using the protocol peaked at $30 million per day in early December 2021, but is now near $6 million. Meanwhile, Dfinity (ICP) and Chainlink (LINK) are adjusting after a 40% or higher rally in the first 10 days of 2022.

Tether’s premium and the futures premium held up well

The OKEx Tether (USDT) premium or discount measures the difference between China-based peer-to-peer (P2P) trades and the official U.S. dollar. Figures above 100% indicate excessive demand for cryptocurrency investing. On the other hand, a 5% discount usually indicates heavy selling activity.

OKEx USDT peer-to-peer premium vs. USD. Source: OKEx

The Tether indicator bottomed at a 3% discount on Dec. 31, which is slightly bearish but not alarming. However, this metric has held a decent 2% discount over the past week, signaling no panic selling from China-based traders.

To further prove that the crypto market structure has held, traders should analyze the CME’s Bitcoin futures contracts premium. That metric analyzes the difference between longer-term futures contracts to the current spot price in regular markets.

Whenever this indicator fades or turns negative, it is an alarming red flag. This situation is also known as backwardation and indicates that bearish sentiment is present.

BTC CME 2-month forward contract premium vs. Bitcoin/USD. Source: TradingView

These fixed-month contracts usually trade at a slight premium, indicating that sellers request more money to withhold settlements for longer. As a result, futures should trade at a 0.5% to 2% premium in healthy markets, a situation known as contango.

Notice how the indicator flipped negative on Dec. 9 as Bitcoin traded below $49,000 but it still managed to sustain a slightly positive number. This shows that institutional traders display a lack of confidence, although it is not yet a bearish structure.

Considering that the aggregate cryptocurrency market capitalization is down 9.5% to date, the market structure held rather nicely. The CME futures premium would have gone negative if there had been excessive demand for short-sellers.

Unless these fundamentals change significantly, there is not yet sufficient information available that would support calls for a sub-$40,000 Bitcoin price.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.