Category Archives: Bank of Thailand

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Increasing ICO Interest in Thailand as 50 Apply for Licenses

In Thailand, initial coin offerings (ICOs) may soon be finding their legal footing after approximately 50 ICO projects displayed interest in applying for licenses to operate.

Application progress

According to local media outlet The Bangkok Post, the Thai Securities and Exchange Commission (SEC) has seen a growing interest in those wishing to raise funds through the crowdfunding method. Although, according to the SEC secretary-general Rapee Sucharitakul, it remains yet to be seen as to how many of those will be given the operating license.

Furthermore, there are roughly twenty other companies who have made applications for the licenses to operate as cryptocurrency exchanges.

He said, “Licence approvals are being processed,” adding, “Many companies interested in opening digital asset exchanges have said digital assets and cryptocurrency trading in the Thai market are quite active.”

ICO portal

Before the SEC licenses these projects, “ICO portals” will be the first to be selected. The portals are essentially online ICO marketplaces, offering platforms for ICO issuers to operate their sales. According to Sucharitakul, three out of five companies who are seeking to operate as ICO portals have filed their applications already.

In early May, proposals for cryptocurrency tax and regulations were slowly coming to fruition. This came at a time when many international governments and financial regulators were also beginning to formalize appropriate crypto-laws and legislation.

Chief executive Thuntee Sukchotrat of digital asset exchange JIBEX said, “I believe that investors will invest in digital assets instead of stocks in the future. The performance of ICOs will rise in line with ICO project performance. The investment ratio of ICOs to stocks will be on par within two years.”

Recent months

In late May, the Thai SEC established that it would monitor ICO operations and cryptocurrency related businesses. Furthermore, a regulated SEC ICO Portal was further discussed, which would allow for domestic ICOs to be issued legally.

In June, the SEC made further inroads upon the announcement of its cryptocurrency laws, though there are only seven legal cryptocurrencies, which are Bitcoin, Bitcoin Cash, Ethereum, Ethereum Classic, Litecoin, Stellar, and Ripple.

Shortly after, the SEC took five out of 50 ICO projects and announced they would be running them as pilots. Later on in August, Thailand reaffirmed its crypto-positive stance after the Bank of Thailand made it legal for local banks to issue digital tokens, provide crypto brokerage services, operate crypto-related businesses and invest in cryptocurrencies via subsidiaries.

 

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Bank of Thailand Seeks Efficiency Through Blockchain Solutions

Veerathai Santiprabhob, the Governor of the Bank of Thailand, has confirmed that the government-supported central bank will be further exploring the utilization of blockchain technology to provide a more efficient inter-bank payment system.

The bank will be undertaking a project to investigate the practicality of using blockchain technology to support a wholesale digital currency while also ensuring that inter-mediation activity is reduced and transactions within the system are highly secure.

In his speech at an international investment forum in Singapore, Santiprabhob noted the increasing acceptance of blockchain technology in the financial environment of Asia. He stated that Bank of Thailand and other national banks will co-develop a new way of conducting inter-bank settlement using wholesale central bank digital currency (CBDC).

Already, CBDCs are being used in a number of countries and many nations across the world are considering the feasibility of their introduction. In his speech, Santiprabhob advised that, like other central banks, the goal was not to immediately bring CBDC into use, but rather to explore its potential and implications.

He also confirmed that Thailand had commenced the Inthanon project which would be focused on increasing the efficiency of a number of key financial transactions and activities, such as the settlements, as well as Letters of Guarantee. This would include improving validation processes while reducing processing time and costs.

Thailand’s central bank has been going through a process of adaptation, including the introduction of legislative changes with a new Payment System Act, to prepare itself for ongoing developments in technology and increased digitization of financial processes. It is anticipated that through the adoption of innovative blockchain based processes there will be substantial reductions in fees and charges for business operators when compared to the traditional financial environment.

The governor also remarked, “These efforts should pave the way for faster and cheaper transactions and validation due to less inter-mediation needed compared to the current systems.”

Efficiency enhancements had already been identified as part of a trial associated with the issuing of bonds by the Central Bank. Santiprabhob noted that the project had been able to “speed up saving bond allocation to retail investors from 15 days to 2 days”.

The formal support for the Inthanon project clearly demonstrates a recognition by the Bank of Thailand of the role that blockchain technology will be playing in the official financial environment.

 

Image Source: Flickr – Kat

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