The Central Bank of Thailand (BoT) has opened a public discussion on the launch of the government’s digital currency and its capabilities.
The regulator accepts comments until June 15th. The Bank of Thailand has published an advisory report on the prospects for the digital Thai baht launch. According to the document, the state digital currency is considered a safe means of payment and can be used along with cash. The digital baht will be available to both large companies and small firms, including ordinary citizens.
Deputy Governor of the Bank of Thailand Vachira Arromdee said that testing of the Central Bank’s digital currency for retail payments is scheduled for the second quarter of 2022. A full launch of the digital Thai baht can take place within three to five years.
Arromdi said the government’s stablecoin will not affect Thailand’s financial system. On the contrary, it will lay the foundation for a secure payment infrastructure, ensure effective interaction between the government and the private sector, and foster financial innovation. However, it will not do without the attendant risks associated with the launch of the digital baht. Therefore, it is necessary to study its possible consequences in order to hedge against problems in the financial sector.
The Bank of Thailand also considers it necessary to study in more detail the technical, operational and legal aspects of using the government stablecoin for settlements between large financial institutions. Therefore, the regulator began a public discussion of the possibilities of the digital baht, options for its use, and what measures should be taken to reduce potential risks. BoT is ready to accept comments until June 15th.
Last year, the central bank of Thailand began developing a prototype payment system designed for settlements between financial institutions that are ready to use the state digital currency. The system is based on the developments of the Inthanon research project focused on interbank payments.
In addition, the Bank of Thailand believes that private cryptocurrencies pegged to the Thai baht are illegal.
