The firm, led by Oxford-educated Jirayut Srupsrisopa, expanded dramatically last year and lately employed 230 people from a larger office complex in Bangkok with its own restaurant facilities, nap room and modern management methods. What promises to be the first Thai unicorn was already reaching turnover levels over ฿2 billion per day this January offering hope and an inspiration to thousands of young Thais.
A Thai internet success story is facing questions this week after a resolution from the Securities and Exchange Commission in Bangkok, on Monday, ordered Bitkub, at one stage during January, Thailand’s most popular smartphone app online, to strengthen its internet-based systems following consumer complaints after the high-flying cryptocurrency exchange went down due to surging traffic on a number of days.
One of Thailand’s brightest young entrepreneurs and founder of the highly successful currency exchange platform, Bitkub, is under pressure this week following a meeting of the Securities and Exchange Commission on Monday and a resolution confirmed by the SEC calling on Bitkub to upgrade its online platform, among other things, following a barrage of complaints from users in the last few weeks as the company struggled to cope with a surge in demand for its services.
Jirayut Srupsrisopa, the CEO of Bitkub Capital Group Holdings has said that his firm controls 90% of the cryptocurrency exchange market in the kingdom and over the past month, the company’s smartphone app had become the kingdom’s most popular application even surpassing downloads of the biggest social network apps such as LINE and Facebook in Thailand.
Huge success of Bitkub linked to the surge in popularity and pricing of cryptocurrencies
The huge success of Bitkub can be linked to a massive run on the top cryptocurrency Bitcoin which surged in value from the weeks before Christmas 2020 when it was worth approximately ฿700,000 to a peak of ฿1.25 million over the last few weeks showing an appreciation of 75% in little under a month. The price has now begun to subside and is currently at ฿1.06 million.
Mr Jirayut, known affectionately as Khun Topp, is an Oxford-educated visionary whose firm before this crisis has threatened to become Thailand’s first unicorn or internet success story with plans to go public and expand throughout Asia as well as worldwide.
Khun Topp is a popular and inspiring personality who regularly gives seminars throughout Thailand including addresses to prestigious universities and the Bank of Thailand.
His vision extends beyond cryptocurrencies to the wider application of blockchain technology which Bitkub has also begun to work on.
Massive advertising campaign and new investments saw Bangkok unicorn startup employ 230 people
Bitkub launched a massive advertising campaign at the end of last year after securing new investment and moved to new and expanded offices incorporating its own restaurant area, nap room and a range of departments from human resources to operations including regulatory compliance, marketing and engineering teams.
The business staff count increased from over 100 to 230 people. The founder, Mr Jirayut, has embraced modern and progressive management techniques such as stand up meetings and advanced teamwork.
In the last few weeks, the firm has been the subject of positive press coverage with thousands of young Thai people applying to work with the ‘modern’ organisation.
Current operational difficulties reviewed by Thai Securities and Exchange Committee on Monday
The current difficulties being experienced by the firm were exacerbated further in recent days when the site closed just hours after the SEC issued its order and a programme to rectify its service to the public and gave Bitkub 5 days to comply.
While the full site and platform closed on Tuesday, the mobile application for it and the exchange was back online sometime after 5 pm. The site had been closed for 16 hours.
Bitkub turnover reached over ฿2 billion per day
The success of Bitkub since January had seen the platform in one day top ฿2 billion in gross turnover and even saw its founder announce plans by the firm to employ a Chief Investment Officer to take it public. Khun Topp also stated that it was seeking investment opportunities.
SEC calls for action from the company under Section 35 of the Emergency Decree on Digital Asset Businesses 2018 and gives it five days
The resolution, on Monday, was made under Section 35 of the Emergency Decree on Digital Asset Businesses 2018 and called on the firm to deal with the issues hampering its services which saw the site shut down on January 2nd, 3rd and 16th due to huge surge in demand.
The first aspect of the required solution by the SEC is that Bitkub strengthens its operating system allowing investors to purchase cryptocurrencies and make withdrawals.
Must improve its regulatory regime for screening and approval of customers of the platform
It also calls on the firm to improve its compliance procedures and what the industry refers to as Know Your Customer guidelines.
These are worldwide industry standards for financial institutions requiring them to verify the identity of investors and make a judgment on their suitability for an ongoing trading relationship based on risk assessment and worldwide efforts to combat money laundering.
The SEC also required that Bitkub ensures that its system is robust enough to deliver a continuous and uninterrupted service to its customers even with the surges in demand that it is experiencing.
The regulatory body called on the company to take steps to match its customer acceptance and compliance policies to its operating system and resources.
Not the first Thai cryptocurrency exchange or market leader to have problems or issues like this
This is not the first time a Thai cryptocurrency exchange and market leader has run into difficulties.
Two years ago, a long-established firm in Bangkok, Bitcoin Co. Ltd., announced that it was voluntarily winding down its operations when it experienced similar problems.
That firm, at one time, was also a market leader in the industry but on far lower trading volume.
Bitkub and its dynamic founder now face a challenge to avoid becoming a victim of its own success
Bitkub, the Bangkok based success story and its founder Jirayut Srupsrisopa now face a challenge to reassure investors using its service that their money is safe and deal with what probably are technological and capacity problems as well as the implementation of new procedures in a market where the value of Bitcoin is going down instead of up.
Industry insiders are pointing to other operators in Bangkok but Bitkub has consolidated its position as the industry leader in these last few weeks, mopping up a reported 97% share of the market.
There are foreign-based cryptocurrency exchanges but many are not as advanced as the promising Thai startup and do not offer such a direct service denominated in baht.