Key Takeaways:
- Thailand intends to publish detailed rules for digital assets in order to reduce risks to the financial system and provide greater investor protection as more people become interested in cryptocurrencies.
- In January 2022, the Bank of Thailand intends to release a consultation paper on the “Financial Landscape.”
- The report will seek agreement on what it refers to as “red lines” for cryptocurrency users and businesses.
- The new regulations aim to reduce financial system risks and increase investor protection.
According to the central bank, Thailand intends to publish detailed rules for digital assets in order to reduce risks to the financial system and provide greater investor protection as more people become interested in cryptocurrencies.
In January 2022, the Bank of Thailand intends to release a consultation paper on the “Financial Landscape.” The report will seek agreement on what it refers to as “red lines” for cryptocurrency users and businesses. Governor Sethaput Suthiwartnarueput of the central bank specifically stated that cryptocurrencies as payment channels are one of those red lines that will not be tolerated.
The new regulations aim to reduce financial system risks and increase investor protection. The central bank intends to begin testing its own CDBC next year, so Thailand may follow China in abandoning crypto in favor of its own state-controlled currency. The Bank of Thailand has repeatedly issued cryptocurrency warnings and cautioned commercial banks against direct involvement in cryptocurrencies.
Previously, a central bank senior director stated that “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.” A senior director of the Bank of Thailand warned businesses against accepting cryptocurrency payments, stating that if “other currencies” were widely used, “the central bank’s ability to oversee the economy would suffer.”
The central bank crackdowns come at a time when several of Thailand’s leading commercial banks have expressed interest and invested in cryptocurrency platforms. Thailand’s oldest and first commercial bank, Siam Commercial Bank, has acquired a majority stake in Bitkub, Thailand’s leading cryptocurrency exchange.
