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Business & Finance

Trade of Cryptocurrencies Sanctioned in Exclusive Branches of Banks in Thailand

The Bank of Thailand has allowed the local banks to accumulate branches that exclusively deal with cryptocurrencies.

The announcement made also mentioned that the bank can now give virtual tokens, supply crypto brokerage products and services as well indulge the businesses involved in digital assets and make investments too.

The bank of Thailand may have allowed the set up subsidiaries for dealing with cryptocurrencies; however, they are prohibited from dealing directly with bitcoin and other cryptocurrencies.

These subsidiaries which are established to deal with cryptocurrencies, are still not allowed to offer their customers any service related to cryptocurrencies. These branches are prohibited from providing services pertaining to crypto to all the customers and other individuals. The provision attached to this are that they could only interact and deal with institutions which have been approved by Thailand’s Securities and Exchange Commission (Thai SEC) and the Office of Insurance Commission (OIC).

The exclusively set branches can provide investment resources to its customers. However if they wish to invest in digital assets with the objective of developing “financial innovation” they have to use the Bank of Thailand Regulatory Sandbox.

The central bank of Thailand also banned its customers from using credit cards for sale and purchase of cryptocurrencies earlier this year. This was done in accordance with the circular which was received. It mentioned that banking institutions of Thailand would not be allowed to invest and trade in cryptocurrencies and will not be allowed to work for establishing crypto exchanges as well. This however is legal in the country if the bank is registered.

On May 13, the royal decree of Thailand issues a regulatory framework that would regulate the sale and purchase of cryptocurrencies as well as blockchain. It was posted in the Royal Gazette and mentioned words like digital tokens and digital assets. By the royal decree the cryptocurrencies were brought under the regulatory jurisdiction of the Thai Security Exchange Commission (SEC). In this framework the Thailand central Bank was prohibited from crypto trading and investments.

In addition to this, the governor of the Bank of Thailand also revealed that they plan on issuing their own cryptocurrency. This announcement was made in Thai economic development at Nomura Investment Forum Asia (NIFA) in Singapore. The governor lay emphasis in his keynote speech that they are not trying to prioritize the adaptation of CBCD but are rather experimenting in this field. He said,

Like other central banks, our goal is not to immediately bring CBDC into use, but rather to explore its potential and implications for back office operations.

The governor also said that they were eager to utilize blockchain into their financial structure because of the advantages it provides.

In July, the Thai government also sanctioned the regulatory framework for ICO’s (Initial Coin Offerings) that was sanctioned by the royal decree earlier in May.

The intentions of the Thai government have become more elaborate regarding blockchain and cryptocurrencies. Like numerous other countries they also intend to keep developing the technology and keep up with the rest of the technological world.

Hassaan Malik

Co-founder of BlockPublisher, Hassaan is a technologist at heart with a keen interest in blockchain, cryptos and traditional financial markets. Email: hassaan@blockpublisher.com, hassaanmalek@gmail.com

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