A digital asset exchange has become one of only a handful of businesses authorised to provide cryptocurrency exchange services in Thailand.
The company is focused on providing retail and institutional investors with the ability to invest securely in cryptocurrencies.
This is after the nation’s Ministry of Finance and the Securities and Exchange Commission (SEC) granted them the first digital asset exchange licence of 2020.
The CEO and Co-founder of the Thailand branch of the company, talking on gaining the exchange licence, stated that the company believes that being a regulated entity will help provide trust to newcomers looking to enter the digital assets market.
Active Regulation
Thailand has been active in recent years forming a legal structure for digital currencies and tokens, with an emphasis on initial coin offerings (ICOs) and digital exchanges who need to comply with KYC/AML procedures and implement strict levels of IT security.
With exchange operations already established in Singapore, Australia and Indonesia, the expansion into Thailand will mean the new arrival will now facilitate fiat-to-crypto pairings in THB, USD, SGD, IDR and AUD.
The firm’s advisory board are thought to have been instrumental in guiding the company through Thailand’s legal landscape and include a former chairman of Stock Exchange Thailand, the Vice Minister to the Deputy Prime Minister of Thailand, and the Corporate Affairs Specialist of True Corporation Plc.
It was noted that digital currencies and securities are emerging asset classes for both the banked and unbanked. It is an interesting time in Thailand’s financial history, and industry experts are glad that Thai regulators are working with exchanges to build regulatory frameworks for these new technologies to operate within.
According to another article, Thailand’s Ministry of Finance already made plans to improve how digital assets were regulated in the country.
The digital asset exchange license falls among one of several initiatives the country implemented to create a regulatory framework. They claim it will provide a legitimate and safe environment for investors.
A total of 30 cryptocurrency exchanges have applied for the digital asset exchange license and the cryptocurrency firm is one of a small handful that received approval.
Pushing Digital Currencies in Thailand
It was also recently reported that The Bank of Thailand and Hong Kong’s central bank announced that they have moved a step closer to issuing digital currencies that could be used to make payments between the two countries far more efficiently than at present.
A report published by the two central banks confirmed the technical feasibility of using a central bank digital currency (CBDC) to make cross border payments more efficient, cheaper, lower risk and more transparent. However, there is no timeframe yet for a real transaction.
Many central banks around the world are looking into building CBDCs, traditional money but in digital form. They would differ from cryptocurrencies like bitcoin which are produced by solving complex math puzzles and governed by disparate online communities instead of a centralised body.
Previous studies have focused on the technical challenges of using CBDCs for cross border payments, the most recent report concentrated on practical issues like foreign exchange pricing and the impact on liquidity.
The Bank of Thailand and the HKMA will continue to work together on this joint initiative, which could be expanded to include other central banks, or linked with other separate initiatives.
