Thailand will be establishing ‘red lines’ for cryptocurrency in early next year, 2022.
Sethaput Suthiwartnarueput, governor of the Bank of Thailand stated that “Cryptocurrencies cannot be used as a means of payment.”
Thailand’s government is working on a new legal framework for cryptocurrencies such as Bitcoin (BTC) and others to reduce risks and increase investor protection.
In a December 14 interview with The Bangkok Post, governor Sethaput Suthiwartnarueput stated the Bank of Thailand (BoT) will birth a consultation document in January that will set “Red Lines’ ‘ for the cryptocurrency industry.
“We want to find the correct balance between encouraging financial innovation and risk management,” the person said. The new guidelines will provide enough consumer protections because “risks are currently under-appreciated,” according to Sethaput.
The central bank is working with the Thai Securities and Exchange Commission and the finance ministry to highlight crypto-industry-specific regulations. “Cryptocurrencies cannot become a form of payment,” for example, according to Sethaput.
Even though municipal governments may recognize digital assets as an investment product, the governor stated that their excessive volatility posed a risk to the financial system. He also stated that authorities will work together to adopt appropriate safeguards for future financial securities.
Thailand’s ambitions to pass new bitcoin regulations coincide with a surge in local cryptocurrency use. According to the research, in November 2021, the turnover at seven domestically licensed crypto exchanges increased to 221 billion baht ($6.6 billion), up from 18 billion baht ($538 million) a year earlier.
The Thailand Central Bank warned commercial banks against “direct involvement” in cryptocurrency trading in early December, citing significant volatility and potential hazards.