Thailand’s central bank has warned against the use of THT stable coin via a circular. Stablecoins currently have a market cap of over $53 billion.
The Bank of Thailand has warned against the use of THT stable coin via a circular. Stablecoins currently have a market cap of over $53 billion.
Stable coins provide a means to hold digital assets without worrying about their inherent volatility. They have amassed popularity recently, and many central banks are considering issuing them.
It released a circular on March 17, 2021, prohibiting the use of THT. The Bank of Thailand outlined that the Baht-backed coin “could cause fragmentation to the Thai system.” It is concerned that widespread adoption of THT would deplete confidence and reliance on Baht.
As a result, it has declared that THT use is illegal. It also issued a warning to the public members to desist from using THT or participating in any activity involving it.
Bank of Thailand’s CBDC In View
Central banks around the world are on edge in light of the current cryptocurrency frenzy. They want to retain the ability to issue and control money. As a result, many are preparing to launch their own digital currencies.
Thailand is one of Asia’s leading nations in the race for a fully adopted Central Bank Digital Currency (CBDC). It launched a trial for the digital Baht in 2019, which eight commercial banks participated in.
A noteworthy fact about the digital Baht is that it may not be publicly available. Financial institutions and markets are likely to be the exclusive users of Thailand’s CBDC.
On March 8, BoT issued a press release on the results of a CBDC test project which commenced in 2020. The project was aimed at analyzing the efficiency of digital currencies as a payment in the business sector. The BoT concluded that “DLT can increase payment efficiency for businesses by allowing users to set various conditions on the CBDC to enhance flexibility in handling business activities.”
China recently started the biggest phase of its digital currency trial in the city of Chengdu. It had already recorded over $160 million in transactions for the CBDC.
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