The announcement read,
“The development of a Retail CBDC is a key milestone with the potential to alter the financial infrastructure and ultimately the financial landscape, which could cause broad changes in the roles of many stakeholders.”
As part of this process, the bank has also published a preliminary report titled “The Way Forward for Retail Central Bank Digital Currency in Thailand,” with the same expanding on the bank’s position on CBDCs and the wariness it has for other cryptos. The same was highlighted a few weeks ago after the Bank deemed a stablecoin issued by Terra in the form of Thai Baht Digital [THT] illegal.
Previously, the Central Bank’s Assistant Governor Siritida Panomwon Na Ayudhya had said,
“The central bank is receiving opinions from market regulators and participants before announcing regulations.”
The BoT had also announced that it will be regulating foreign currency-backed stablecoins, asset-backed stablecoins, and algorithmic stablecoins that are not illegal. However, these regulations will not be extended to those without asset backing like Bitcoin or Ethereum, it clarified.
The recent report also addressed the CBDC’s implementation strategy and how it would engage with stakeholders, as well as a cost-benefit study to help appreciate the threats, benefits, and difficulties associated with a national digital currency. Despite a positive position on CBDCs, a substantial danger exists that the citizens would choose digital currency over fiat.
To counter this possibility, withdrawal limits will be created, along with other protections to prevent a significant upheaval in the stock system.
Given the extent of Thailand’s activities in space, it seems that the country will soon join a growing list of countries planning to launch their digital fiat.
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