Thailand does not prohibit the use of cryptocurrencies for payments, but warns of price fluctuations

Bank of Thailand (BOT) officials say using cryptocurrencies as a means of payment is not illegal. However, they stress that users must “be able to accept risks”, including price fluctuations.

Sakkapop Panyanukul, senior director in BOT’s monetary policy department, clarified the central bank’s stance on cryptocurrencies this week.

According to him, the BOT is currently discussing with the Securities and Exchange Commission of Thailand (SEC), relevant authorities and various other stakeholders how cryptocurrencies can be regulated. The aim of the bank is to limit the risks for users related to the use of cryptocurrencies for payments.

Noting that some people have used cryptocurrencies to pay for goods and services in Thailand, Panynukul stressed:

“It’s not illegal … but the user has to take the risk.”

The Thai central bank has previously stated that cryptocurrencies are not legal tender in the country and that their use as a medium of exchange constitutes “the exchange of goods between digital asset owners” and suppliers of goods or services, where the payer and the recipient jointly assume all associated risks . If other currencies are widely used, it will affect the central bank’s ability to monitor the economy. ”

According to another senior director of the BOT, Chayawadee Chai-anant, many central banks around the world share the same concern about the risk that cryptocurrencies cause financial instability. She stated:

“Not currently prohibiting BOTs, but are concerned about the use of digital assets to pay for goods and services due to their volatility.”

Meanwhile, the Thai central bank announced Tuesday that it is preventing commercial banks from directly engaging in cryptocurrency trading due to the risks inherent in high price fluctuations. Chai-anant said in a press conference:

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

However, she states, “If the company is a shareholder, that’s a different matter.” Siam Commercial Bank (SCB), one of the largest banks in Thailand, announced last month that it would buy a 51% stake in a cryptocurrency exchange.

The digital currency is gradually becoming a popular means of payment for goods and services in Thailand. In July, the Thai central bank issued a warning regarding the use of digital assets as a means of payment, Bitcoin Magazine reported. In October, the Prime Minister also warned investors against investing in cryptocurrencies as they are volatile and highly speculative.

In November, Thailand’s Tourism Authority (TAT) announced that it was working with the SEC and the central bank to make it easier and more convenient for travelers to use cryptocurrencies in the country.

“Cryptocurrency is the future, so we need to make Thailand a cryptoactive society to welcome this tourist group,” said the TAT governor.

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