Thailand is considering a potential Bitcoin pilot project, proposed by former Prime Minister Thaksin Shinawatra, which would be tested in Phuket as a tourism-focused sandbox.
The proposal has received support from the CEO of Binance Thailand, who sees it as a positive step for the country’s competitiveness and its ability to attract tech-savvy visitors.
However, despite efforts by industry advocates and some political supporters to transform the Kingdom into a digital hub, crypto payments remain banned in Thailand by the central bank.
Is Thailand gearing up for crypto?
The proposal “not only reflects the dynamics of global crypto adoption, but also demonstrates that leaders at the highest levels are embracing these transformative technologies,” Nirun Fuwattananukul, chief executive officer of Gulf Binance, said the Bangkok Post before adding:
“As more countries adopt digital assets and cryptocurrencies, Thailand must not be left behind. »
He went on to say that given the country’s reliance on tourism and foreign flows, “the integration of cryptocurrencies into Phuket’s economy could well align with Thailand’s strategic strengths , potentially attracting tech-savvy visitors and investors.”
However, there is currently a divide in regulatory oversight in Thailand, as payment systems fall under the jurisdiction of the central bank, while digital assets are regulated by the Securities and Exchange Commission.
Thailand also operates under a restricted currency system, unlike countries like the United States and Japan, which have already implemented Bitcoin payments.
Before implementation, several key challenges must be addressed, and the Bank of Thailand, which has vehemently opposed cryptocurrencies in the past, will have ultimate oversight.
The central bank needs to carefully study risks, especially regarding money flows and economic stability, and regulatory frameworks need to be updated through collaboration between the BoT and SEC, which could take time.
Consumer protection and anti-money laundering measures must also be put in place, according to the report.
Restricted foreign access
The proposal suggests starting with a controlled sandbox environment in Phuket to monitor and assess the implications before considering nationwide adoption.
However, the wheels of bureaucracy turn slowly in Thailand. Additionally, many local payment systems and platforms, such as PayPal and Binance Thailand, are not accessible to foreigners visiting or residing in the kingdom.
Additionally, Thailand’s digital asset market is undergoing a shift from retail to a more institutional focus, Fuwattananukul said in October.
At the time, Thailand’s securities regulator proposed rules that would allow institutional-grade mutual and private funds to invest in crypto products such as US spot crypto ETFs.
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