The Thai Securities Exchange Federation (SEC) has been trying to better protect digital currency investors by introducing new rules on password escrow services.

The Thai Securities and Exchange Federation issued a requirement on January 17th, requiring virtual asset service project providers (VASP) to create an intelligent digital wallet management system to ensure efficient escrow. The new rules are for password custodians or VASP who provide password storage services.

This requirement consists of three main provisions, including relevant policies and basic guidelines for the control of digital wallets and public key risk control. The rule requires VASP to communicate with regulators about such existing policies and provide plans to ensure compliance.

In addition, SEC requires password custodians to provide design, development, design and management of digital wallets and keys related policies and procedures. The Management Service will also require password custodians to formulate contingency plans in the event of a variety of unpredictable events that may affect the wallet management system.

Foreign securities trading federations said: "this includes the development and testing of behavioral procedures, specific responsibility, and reporting."

We also need to carry out financial audit on system optimization. If there are any system optimization events related to digital asset trusteeship, which may cause serious harm to customer property, we also need to conduct digital forensics research.

According to the announcement, the new rules will come into effect on January 16, 2023. SEC added that password custodians must follow them thoroughly within six months from the effective time.

The latest password policy and regulations issued by the Thai Securities and Exchange Federation are in line with the agency's plan to adopt stricter password laws and regulations after bankruptcy in areas such as the collapse of FTX. It is reported that in early January, the government conducted a new survey of Zipmex, a nearby password trading center, accusing the company of providing data asset fund management and services without permission.