Bank of Thailand

The Bank of Thailand prevent banks from cryptocurrency trading

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The Bank of Thailand has stated that it does not want the commercial banks in the country to be directly involved in the trading of cryptocurrencies.

The edict came right from the central bank’s chief executive, Chayawadee Chai-Anant, on Dec. 7, citing risks associated with high price volatility, according to cointelegraph

“We don’t want banks to be directly involved in digital asset trading because banks are (responsible) for customer deposits and the public and there is a risk.”

The latest round of digital asset suppression by the central bank comes at a time when commercial banks have been investing in local cryptocurrency exchanges, according to a Bangkok Post report.

In early November, Thailand’s oldest bank, Siam Commercial Bank (SCB), announced that it would buy a 51% stake in the country’s largest cryptocurrency exchange, Bitkub. At the end of August, the Zipmex crypto exchange raised $1.3 billion in funding from the country’s fifth-largest lender, Bank of Ayudhya.

The Bank of Thailand (BoT) has taken a tougher stance against digital assets, despite their growing popularity in the country among individuals, companies, and banks.

Last week, BoT senior director Sakkapop Panyanukul warned companies of accepting cryptocurrencies, saying, “If other currencies are widely used, it will impact the central bank’s ability oversee the economy.” Referring to tokens that are not backed by assets, he labeled them as “blank coins”.

The central bank has also expressed concern about the use of cryptocurrencies to pay for goods and services. In a similar report on December 8, Chai-Anant commented that digital assets could be harmful to traders and consumers because they are “associated with high price volatility and risks of cyber theft, personal data leakage, and money laundering.”

“If digital assets become widely used as a means of payment for goods and services, such risks could affect payment system stability, financial stability, and consumer protection.”

BoT warnings come just two weeks after the kingdom’s tourism ministry stepped up its efforts to encourage the crypto-rich to visit the country. The Thai tourism authority has called the country “crypto-friendly”, but central bankers clearly do not want to be too friendly.

Thailand’s economy is heavily dependent on the tourism industry, which was hit during the pandemic. Much of the Kingdom remains stuck, with very few entries at the time of writing, despite efforts to attract cryptocurrencies and the like in a country where the central bank does not want them to use digital currency.

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