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Thailand’s largest crypto exchange Bitkub hit with wash-trading allegations

By Alara Jordan

Edited by Charlie Mellor

15:20, 28 September 2022

Mobile phone with webpage of Bitkub
The filing follows Thailand’s Siam Commercial Bank’s decision to abandon its $535m takeover to acquire a 51% stake in the crypto exchange – Photo: Shutterstock

Thailand’s largest crypto exchange Bitkub faces new regulatory scrutiny for the second time in the span of two months over falsifying and creating artificial trading volume on its platform.

A filing from the country's Securities and Exchange Commission (SEC) shows that the SEC will take legal action against Bitkub, as well as its two named representatives Anurak Chuachai and Sakon Srakawee, claiming that all three parties created artificial volumes of digital assets, also known as a process called wash trading.

Wash-trading refers to an illegal form of trading where investors buy and sell assets at the same time to feed misleading information in the market to manipulate profits.

The lawsuit claims expenses of around THB24,161,292 ($635,000, £588,000) from Bitkub, with Anurak and Sakon also facing a six-month trading prohibition.

ETH to THB

Second SEC probe in two months

Founded in 2018, Bangkok-based Bitkub has 75 coins available on its exchange with a 24 hour trading volume at $58,920,010.48, according to data from CoinMarketCap.

DOGE/USD

0.13 Price
-2.340% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 0.0012872

BTC/USD

66,815.00 Price
-0.920% 1D Chg, %
Long position overnight fee -0.0616%
Short position overnight fee 0.0137%
Overnight fee time 21:00 (UTC)
Spread 106.00

SOL/USD

172.98 Price
-1.180% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 2.2652

ETH/USD

3,492.04 Price
-0.960% 1D Chg, %
Long position overnight fee -0.0616%
Short position overnight fee 0.0137%
Overnight fee time 21:00 (UTC)
Spread 6.00

The exchange faced a similar allegation just last month as the SEC fined Bitkub’s chief technology officer Samrong Wachanasathien a total of THB8.5m ($223,000, £206,000) for alleged insider trading.

The filing also states that Wachanasathien will face a prohbation period of 12 months.

SBC abandons acquisition deal

The fresh allegations are a hefty blow for the exchange after Thailand’s Siam Commercial Bank (SBC) announced it would abandon its acqusition plans following its November 2021 announcement to buy a 51% stake and become the largest shareholder.

At the time of the announcement, SBC CEO Arthid Nanthawithaya said the move was in line with the bank’s strategy “to upgrade to a financial technology group” in order to meet growing consumers demands in a competitive crypto arena.

The deal was set to be around $535m, with the bank citing regulatory concerns over its decision, according to Reuters.

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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