Thailand’s Monetary Authorities Decide To Regulate Crypto Payments
Thailand’s monetary authorities, The Bank of Thailand (BOT), Securities and Exchange Commission (SEC) and Ministry of Finance (MOF) together decided to regulate the use of cryptocurrencies as a medium of exchange, citing threats of financial instability and crime as primary justifications.
“Digital asset business operators have expanded their business to cover services related to the use of digital assets as a means of payment for goods and services. Some have solicited businesses by offering to facilitate merchants and businesses in accepting digital assets as payment for goods and services such as by setting up digital asset settlement systems. This may result in a wider adoption of digital assets as a means of payment, aside from its usage as investment, which could potentially impact financial stability and the overall economic system. The use of digital assets in this manner could also pose further risks to consumers and businesses through price volatility, cybertheft, personal data leakage, or money laundering, etc.
Recognizing such risks and implications, regulators will consider exercising power in accordance with the relevant legal frameworks to limit the widespread adoption of digital assets as a means of payment for goods and services. Further regulatory guidelines will be issued for certain digital assets that are supportive of the financial system and financial innovation while not posing systemic risks. Feedback from relevant stakeholders and the general public will be taken into consideration to determine the appropriate regulatory frameworks.”
A number of companies including Google and Mastercard now allow the use of crypto at vendors that don’t accept crypto directly. While, companies like OpenNode are building out Bitcoin payment networks via the lightning network.
Thai regulators interpret these developments as moving cryptocurrencies from “investments” to “means of exchange”. They fear that this could cause financial instability.
The regulators in the South East Asian nation intend to limit the “widespread adoption” of cryptocurrencies as a means of payment. However, some assets deemed “supportive” of the financial system will see regulatory guidelines issued for them. This could possibly include a CBDC, for which BOT is planning a pilot project.
Earlier this month, Thailand announced plans to introduce a 15% capital gains tax on cryptocurrency profits. However, the country’s former head of SEC opposes the move, encouraging policy that benefits the trade sector.
