With Thailand leading the world in the percentage of internet users who own cryptocurrencies (20.1% of Thais aged 16-64), it’s easy to see why so many businesses are opting to invest in or facilitate this hugely popular and rapidly growing market, gradually shifting the dynamics of money and finance with significant implications for the country’s future. SCB bought Bitkub, a Thai cryptocurrency exchange, for 18 billion baht last November, propelling the unicorn startup, which launched in 2018, into the top ten worldwide cryptocurrency exchanges.
Although cryptocurrency is the most well-known and widely discussed blockchain technology, there are many pillars within blockchain technology frameworks that need to be better analysed and understood in order to fully comprehend their benefits, as well as the pros and cons, and their implications in order to maximise their potential.
The first cryptocurrency to use blockchain technology was Bitcoin, the most well-known cryptocurrency. It’s a type of digital money that uses encryption to keep track of monetary units and authenticate fund transfers. According to reports, the first cryptocurrency transaction involved two pizzas. But, thanks to the massive marketplaces that have formed, many Thai businesses are also supporting this trend and accepting cryptocurrencies as payment for goods and services. Customers of The Mall Group, for example, can pay for goods, services, and vouchers at its department shops with cryptocurrencies without incurring any costs. Leading real estate developers, such as Ananda and Sansiri, have also taken the plunge and now accept cryptocurrency as payment for their houses and condominiums, providing an innovative avenue to property ownership.
The growing use of cryptocurrencies as a payment mechanism, on the other hand, may have an impact on financial stability and the wider economic system, posing hazards to individuals and businesses through price volatility, cyber-theft, personal data leakage, and money laundering. Thailand was one of the first Asian countries to develop new legislation on the custody of digital assets in order to increase investor safeguards, recognising the promise and risks of cryptocurrencies. Thailand’s central bank will also test a central bank digital currency and has taken a strong position, prohibiting digital asset owners from facilitating cryptocurrency payments for products and services, in order to reduce financial risk.
The blockchain, on the other hand, is far more versatile than a coin. By 2022, financial services infrastructure costs might be reduced by $15-20 billion per year thanks to the usage of blockchain technology. It has also reduced the supply chain’s energy usage by 17% and has the potential to remove 15,000 tonnes of CO2 from the atmosphere per year.
The BOI is currently conducting an in-depth study to assess blockchain technology in order to ensure that Thailand is prepared and well-organized, through education and awareness, and to plan for targeted promotions that can attract foreign investors to Thailand’s market, thereby supporting and benefiting the country’s digital and blockchain landscape.
This new technology has the potential to improve Thailand’s IT infrastructure and build professional IT services in line with international standards, better positioning the country to capitalise on the blockchain future.
Furthermore, a number of extremely relevant areas in Thailand, such as healthcare, smart grids innovation, and education, among others, can use blockchains to improve their processes, with even more benefits expected as the technology evolves.
The BOI recognises the blockchain industry’s immense potential and wishes to help it flourish in the future. To hasten the country’s digital transformation and contribute to a future that is more digitally friendly.
