SCB, The Oldest Bank of Thailand Acquires Bitkub, a Crypto Exchange
- One of Thailand’s central banks, SCB secures a 51% stake in Bitkub.
- Bitkub is one of Thailand’s few approved cryptocurrency exchanges, with an extensive trade volume.
- As per the CEO of the bank, the acquisition will help the bank “create new growth value in the long term amid a new financial world,”
Siam Commercial Bank (SCB), Thailand’s oldest bank, has announced the acquisition of a significant stake in Bangkok-based cryptocurrency exchange Bitkub. The transaction, valued at THB 17.85 billion (approximately Rs. 3,994 crores), is slated to close in the first quarter of 2022, barring any regulatory issues. It is intended to provide the bank with “new growth value in the long term amid a new financial world.” Although this merger may not have immediate worldwide consequences in terms of scale, the SCB-Bitkub agreement will go down in history as one of the most significant crypto mergers and acquisitions ever.
CEO Arthid Nanthawithaya said:
“In the past 1-2 years, the digital asset industry, one of the financial industries of the future world, has grown rapidly, and it could grow further in the long term”.
Bitkub is one of the few regulated crypto exchanges in Thailand, established in 2018 and registered by the Thai Securities and Exchange Commission (SEC). From January to September 2021, the exchange claimed a trading volume of over $30 billion (approximately Rs. 2,23,772 crore), making it the country’s largest crypto exchange by a considerable margin, with a market share of over 90%.
The transaction is scheduled to close in the first quarter of 2022, subject to regulatory permission from the Bank of Thailand (BOT) and the Thai Securities and Exchange Commission (SEC).
“We needed to elevate Bitkub to the global level, so we turned to a strong partner like SCB to help us achieve our target faster and more sustainably”.
-Bitkub founder and CEO Jirayut Srupsrisopa added.
SCB has been around for more than 114 years and is no stranger to the crypto realm. SCB 10X is the bank’s venture capital arm that invests in blockchain and decentralised finance (DeFi) companies. SCB10X is a cryptocurrency investor who has stakes in Ripple, BlockFi, and Alpha Finance. SCB also started using Ripple’s payment network, RippleNet, to facilitate cross-border payments using digital money transfer provider Azimo in April 2020.
However, Thailand’s crypto economy is not without its regulatory challenges. In June of this year, the Thai Securities and Exchange Commission (SEC) banned crypto exchanges from trading meme currencies like Dogecoin and Shiba Inu. In addition, non-fungible tokens (NFTs)-based collectables and fan tokens were also placed on hold.
Bitkub had a run-in with Thailand’s Securities and Exchange Commission earlier this year when it was instructed to temporarily stop down and rectify issues causing significant disruptions. The regulator gave Bitkub five days to remedy the faults that caused three outages in January amid heightened trading volume after ordering a closure. The site was supposedly unavailable for 16 hours during one of the three recorded disruptions before trading resumed.
Kasikornbank, another big Thai bank, launched a service for digital token offers earlier this year. Cryptocurrencies, such as bitcoin, have been a component of several organisations’ investing strategies, such as financial consulting firm Brooker Group.
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