With Thailand liberalizing its stance on crypto-currencies, local commentators are asking if the country can now become a major regional center for blockchain.
Speculation has increased as the Bank of Thailand announced plans to launch its own crypto-currency by the first quarter of 2019, as reported in Asia Times, while insiders are increasingly predicting new liberalization measures will follow.
The Bangkok Post reported that the new virtual currency will be called the Central Bank Digital Currency (CBDC) and participating banks include Bangkok Bank, Krungthai Bank, Bank of Ayudhya, Kasikornbank, Siam Commercial Bank, Thanachart Bank, Standard Chartered Bank Thai and HSBC.
The move is in stark contrast to the mood in the country at the beginning of the year, when Thai government measures were seen to be sending the crypto industry underground with the introduction of a 7% value added tax in addition to a 15% tax on capital gains for all crypto-currency trades.
Is this new development the start of a sea change for the industry? “This is definitely positive news for Thailand. Many people around the world are now eyeing Thailand as a blockchain destination,” Topp Jirayut Srupsrisopa, Co-Founder & CEO at crypto-currency exchange Bitkub and former CEO of leading Thai Bitcoin exchange coins.co.th, told Asia Times.
Topp believes the previously negative situation had arisen due to differences between tax authorities and financial regulators. “The Securities and Exchange Commission (SEC) has always been very forward thinking with crypto-currency and the blockchain technology.
“The tax law, however, comes from a different regulating entity in Thailand – the Revenue Department. Their 15% tax implication doesn’t make sense, and they do not understand how crypto-currency functions as a transactional protocol, and its benefits in reducing transaction costs in commerce,” Topp added.
New developments in the works, according to Topp, include the SEC creating a crypto-currency exchange license, crypto-currency broker license and a crypto-currency dealer license. On the ICO side, they have created an ICO portal license and legalized seven crypto trading pairs, including Bitcoin, Ethereum, Bitcoin cash, Ethereum classic, Litecoin, Ripple and Stellar.
“This is definitely a positive direction for crypto-currency and blockchain technology in Thailand as the space is being legitimized by the regulators. This will encourage an influx of traditional investors and more institutional money will flow to the crypto-currency industry in Thailand,” said Topp.