Bitcoin Mining Surges in Thailand After Chinese Crackdown – Asean Economist

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Bitcoin mining continues to surge in Thailand after China's crackdown. Local investors bought the equipment and used it locally.
Bitcoin mining continues to surge in Thailand after China’s crackdown. Local investors bought the equipment and used it locally.

Following China’s crackdown is the surge of bitcoin mining in Thailand. Thai investors obtained and operated mining rigs and currently earn between $30 to $40 each day.

Chinese Crackdown’s Impact on Mining Rig Prices

Last year, Thailand’s number of bitcoin miners burgeoned following China’s crackdown on bitcoin mining. The shutdown compelled major players in the crypto industry to terminate or relocate their equipment to more crypto regulation-friendly countries.

Several smaller investors acquired mining gear from the China-based miners because of the low price. Each new machine costs over $13,000, but despite the price, the demand continues to flourish.

Thai businessman Pongsakorn Tongtaveenan buys Antminer SJ19 Pro from Chinese miners and then sells it to local investors. He said:

“Bitcoin is the gold of the digital world. But a mining rig is like gold mining stocks: you’re paid dividends according to the gold price. There are around 100,000 Thai miners now.”

In September, the Chinese government banned all crypto mining and trading. It’s because of the issues about causing unlawful and criminal activities. Additionally, it threatened the economic and financial order in the country.

Thai Crypto Trades Now Subject to Tax Earned from Bitcoin Mining

The Thai government is transforming the country’s crypto ecosystem regulation by implementing new tax rules for the digital currency industry. Crypto trading is now subject to 15% capital gains tax.

The Thai Revenue Department considers stepping up its monitoring tasks after a successful digital asset market last year. It collects taxes from crypto trades as profits from such activities. They consider it taxable income under Section 40 of the Royal Decree amending Revenue Code No.19.

The finance ministry advised investors to calculate and report their revenues from cryptocurrencies in tax declarations this year to prevent penalties. The department will obtain these new taxes from all taxpayers who earned profits from crypto. It includes trading and mining operations.

Crypto Exchange Exempted from Tax

New tax requirements exempt crypto exchanges in the country. Zipmex Thailand raised concerns regarding the current uncertainty about the crypto tax reporting process and how to determine profits.

“Tax methods and calculations should be more concise, clear, and easy to understand. Many people I know want to pay taxes but don’t know how to calculate them,” said CEO and co-founder Akalarp Yimwilai of Zipmex.

The explication ensues after the local government’s plans to define ” red lines” for cryptocurrency this month. The Bank of Thailand will issue a consultation paper for specific regulations for the crypto industry.

Adopting Cryptocurrencies and Regulations

The existing rules have required crypto exchanges to disclose the users’ information to regulators. They need to do it every time there are transactions between firms. This is to regulate a burgeoning number of illegal activities emanating under the manifestation of the global cryptocurrency industry.

Earlier last year, crypto fund managers had to apply for a license to continue the business. The same thing goes for investment advisers. Crypto exchanges run under the SEC’s regulation.

Investors, however, have little support in the portfolio management business. The country wants to boost the stewardship of cryptocurrencies and digital assets. In the same way, it will improve asset management rules in the Thailand crypto-related laws.

Image Source: Alesia Kozik/Pexels



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