Bank of Thailand issues stablecoin guidance outlining plans for digital baht

This article comes fromDecrypt, original author: Ekin Genç

Odaily Translator | Nian Yin Si Tang

Summary:

This article comes from

, original author: Ekin Genç

Odaily Translator | Nian Yin Si Tangsecondary titleSummary:

- The Bank of Thailand divides stablecoins into two categories: Baht-backed stablecoins and other stablecoins;

Bank of Thailand (BOT)

Guidance on Stablecoins Published

, and called for industry input on regulatory advice.

The Bank of Thailand divides stablecoins into two categories, those backed by the country’s fiat currency, the baht, and other forms of stablecoins.

The bank's baht-centric approach differs from other central banks that distinguish between fiat and non-fiat currencies, such as stablecoins whose value is pegged to the dollar and those pegged to the price of gold.

Stablecoins Backed by Thai Baht

The Bank of Thailand refers to the daily-use stablecoin as “e-Money,” a term that falls within the 2017 National Payment Systems Act.

Any interested party that wants to offer a baht-backed stablecoin must obtain permission from the Bank of Thailand.

The Bank of Thailand stressed that the policy was in line with international standards, citing the UK, Singapore and Japan as examples.

Note: According to news on March 18, the Bank of Thailand has issued a stern warning to the privately issued stablecoin THT linked to the baht. The Bank of Thailand has informed citizens that THT has no legal guarantees or protections and users may be at risk of cyber theft or money laundering, noting that any activity involving the stablecoin is considered illegal. THT is a stablecoin based on the Terra blockchain. The platform has also issued other stablecoins, including TerraUSD and TerraKRW, which debuted in September 2020.

other stablecoins

But the Bank of Thailand is much less descriptive of the second type, “other forms of stablecoins.”

This is a broad category that includes both asset-backed and algorithmic stablecoins, as well as foreign currency-backed stablecoins.

But for the Thai crypto industry, there is still some room to influence policymaking.The Bank of Thailand welcomes comments from interested parties on guidelines for other forms of stablecoins. "The (Thailand) central bank is open to comments and feedback before considering appropriate regulatory guidelines," the bank said.。

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While focusing on development, it is also strengthening supervisionThe Bank of Thailand also added that it is currently developing a retail central bank digital currency "to meet the needs of the public, improve service efficiency in the business sector, and increase access to financial services."Central bank digital currencies have been a long-term goal of the bank; last summer, the bank

It was prematurely announced that the central bank digital currency will be launched soonBut the bank has a blockchain project in full swing.Last June, the Bank of Thailand announced an agreement with the Hong Kong Monetary Authority

Collaboration builds a prototype of a multinational blockchain payment system

, known as the "Inthanon-LionRock Project". The project allows banks in Hong Kong and Thailand to provide each other with funds through smart contracts. The two parties have successfully developed a proof-of-concept prototype based on distributed ledger technology with a total of 10 participating banks from the two places, and agreed to carry out further joint research work in related areas, including exploring business cases and connections with other platforms, It will involve banks and other relevant institutions participating in the trial implementation of cross-border fund transfers.

Thailand doesn’t just want to utilize cryptocurrencies in financial services. Tourism Authority of Thailand (TAT) chief Yuthasak Supasorn last monthBangkok PostThailand also hopes to promote tourism through cryptocurrencies: “Even Tesla (Tesla) founder and crypto influencer Elon Musk (Elon Musk) may be interested in visiting Thailand.”

Despite the ongoing moves in the crypto space, the latest regulatory activity in the country has also had a huge impact on the crypto industry. In February, Thailand’s SEC required cryptocurrency investors to provide proof of income before opening an exchange account. Unqualified crypto traders can only invest through financial advisors if they are licensed by the SEC.