The Bank of Thailand is still advocating for a CBDC

    TheMorningCrypto Desk
    TheMorningCrypto Desk
    Published on October 30, 2022 7:47 PM

    Updated on January 26, 2023 10:15 AM

    BoT is working on pilot testing the retail CBDC but the deployment may take an additional five years
    The Bank of Thailand is still advocating for a CBDC

    The Bank of Thailand (BoT) intends to devote more time to developing its retail central bank digital currency (CBDC) to provide the financial sector with new advantages while maintaining sound risk management.

    A retail CBDC has been created by several central banks, including the BoT, but they have yet to introduce the currency into the markets formally. According to central bank governor Sethaput Suthiwartnarueput, it will likely be more than five years until a market launch for the global retail CBDC.

    The boT is working with Banks to test the retail CBDC 

    The governor said that the BoT is still looking for benefits related to PromptPay, Thailand's digital payment infrastructure system and that the BoT wants better to understand the dangers and advantages of a retail CBDC.

    According to him, the currency should gradually change the nation's financial structure for the better. 

    To test the retail CBDC with practical applications on a small scale, the BoT is working with Siam Commercial Bank, Bank of Ayudhya, 2C2P (Thailand) Co, and about 10,000 retail users. 

    The two tracks of the project are innovation and foundation

    CBDC is used to carry out cash-like operations on the foundation track, such as paying for goods and services. The testing phase is anticipated to start at the end of this year and extend through the middle of the following year.

    Regarding the innovation track, it will strongly emphasize programmability and make it easier to design use cases for CBDCs that lead to new financial services for a variety of consumers.

    As part of the Multiple CBDC Bridge (mBridge) projects, which aims to facilitate cross-border payment areas, the BoT is also making progress on creating a wholesale CBDC.

    BoT completed the first pilot test 

    According to the Bangkok Post, the BoT completed the first pilot test using a CBDC as part of mBridge in collaboration with the Hong Kong Monetary Authority, the Central Bank of the United Arab Emirates, the Digital Currency Institute of the People's Bank of China, and the BIS Innovation Hub Hong Kong Center.

    The issuance and redemption of CBDC between central and commercial banks, cross-border currency exchanges between commercial banks, and cross-border payments in local currencies were the three separate transactions tested by mBridge.

    Thai Authorities Step Up Their Crypto Crackdown

    Thailand has increased its enforcement of cryptocurrency restrictions To safeguard ordinary investors in the aftermath of the continuing crypto winter, the Securities and Exchange Commission (SEC) of Thailand said in September.

    The SEC concluded that cautions about the hazards of investing in digital assets must now be included in marketing for virtual tokens clearly and visibly. Ad terms must also be provided to regulators, it was stated.

    To safeguard traders and their clients from the hazards associated with such activities, the SEC attempted to prohibit local cryptocurrency firms from offering staking and lending services to their clients later in the month.