Cryptocurrencies in Thailand
Thailand, officially the Kingdom of Thailand, is formerly known as Siam and at the center of the Southeast Asian Indochinese peninsula. The country has 76 provinces over 513,120 square kilometers and is home to 68 million people. Its largest and most popular city is Bangkok, a destination that welcomes more visitors than any other city in the world. Luxury malls, haute cuisine, boutiques, and markets are awaiting visitors. The ASEAN region has been a leading force in blockchain development, featuring Satoshi Square – an open social event for discussing everything relating to Bitcoin and other cryptocurrencies – and when neighbors like Japan, South Korea and China are added to the mix, it is easy to see why blockchain is a rising force in the broader Asian economy.
Bitcoin and Crypto Policies
While Thailand is ahead of the curve when it comes to broad-based crypto regulation, its Bitcoin and crypto policies, blockchain technology, and goals for the future are yet to be defined. It’s also not clear how all of this will serve the country and its people. Recently, the message and intent became completely muddled by a scandal that rocked the local industry.
A Stock Exchange of Thailand (SET) “whale” investor on behalf of Finnish foreign investors, along with staff at up to three Thai banks, are suspects in being complicit in a scam. Damages are about 797 million baht (US$24 million).
Finnish nationals had informed the Crime Suppression Division (CSD) that they had sent Bitcoin to Thai nationals for reinvestment. The suspect is trying to negotiate a settlement with the two victims. In the meantime, the police are considering whether to file charges with the banks and their employees.
Regulatory Framework in Place
Despite this, The Thai Securities and Exchange Commission (SEC), the main regulator of the country’s crypto industry, are upholding a regulatory framework for cryptocurrencies and ICOs that went into effect on 16 July. Two new laws include the Digital Asset Business Operationand Thai Tax Ramifications, declaring seven cryptocurrencies as legitimate so long as they’re used as a medium of exchanging goods and/or services, and the same cryptocurrencies “securities”, or digital tokens that give investors the right to invest in a project/business or identify rights to obtain certain goods and services. In addition, any gains from buying and selling both cryptocurrencies and digital tokens are subject to Thai income taxation. The seven currencies currently recognized are Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH), Ethereum Classic (ETC), Litecoin (LTC), Ripple (XRP), and Stellar Lumens (XLM).
A week after the Thai SEC announced the new legislation it began accepting applications for crypto licenses. Among exchanges that have applied for a license are Coin Asset, a six-month-old Thai crypto exchange with about 10,000 users. The exchange processes approximately 2 to 3 million baht daily. PundiX is an exchange that seeks to attract the unbanked population. It is helping people to use financial services similar to banks. Coin Asset also applied for a license to operate crypto ATMs. This is the first of its kind among ASEAN countries, supporting baht, euros, yuan, and US dollars. If approved, Coin Asset would install ATMs at Thailand’s major international airports and in northern Thailand’s largest city, Chiang Mai.
Blockchai Applications under Review
The Governor of the Bank of Thailand (BoT) simultaneously announced the bank is considering blockchain technology for various applications, while the central bank’s governor Dr. Veerathai Santiprabhob announced that the bank was specifically reviewing blockchain applications for cross-border payments, supply chain financing, and document authentication. Santiprabhob also believes that using blockchain for cross-border payments would improve regional financial connectivity and facilitate smoother cross-border financial services.
Even before the SEC announcement and legislation, several products and services were already influencing the market. Rapidzpay is a popular app that facilitates transactions between businesses (B2B) and businesses-to-consumers (B2C). The Swiss payment company partnered with Major Cineplex Group to build Thailand’s most popular digital payment ecosystem. The Bank of Thailand (BoT) is calling their new Central Bank Digital Currency (CBDC) blockchain platform, “Project Inthanon”. Phase one that includes eight commercial banks is already underway. Another emerging blockchain project is literally a power/utility-trade platform under development by an Australian company, “Power Ledger”. This project will help residents of Bangkok’s Sukhumvit neighborhood trade power with each other and the state-controlled power utility. The program starts with a 635 KW trade between a mall, a school, a dental hospital, and an apartment complex. The Bangkok electricity grid will determine the amount and direction of the power.
Clearly, Thailand is setting itself apart from other nations when it comes to blockchain and cryptocurrency. It won’t be long before a myriad of blockchain and cryptocurrency companies begin working on big ideas.