The Central Bank of Thailand wants to issue a central bank digital currency. Is it really a good thing for the national team to enter the field?
According to Bitcoin on August 24, the Central Bank of Thailand is working with the country's largest banks to develop a central bank digital currency (CBDC) - Inthanon.
The Bank of Thailand said,In the Inthanon program, covering the design, development and testing of funds transfer between financial institutions in digital currency。
In the first phase, relevant institutions will jointly develop and design based on the R3 Corda platform, and Inthanon will first complete the development of the inter-bank fund transfer function. According to reports, the project is similar to projects currently being developed by other central banks such as the Bank of Canada, the Hong Kong Monetary Authority and the Monetary Authority of Singapore.
In the next phase, participating commercial banks and R3 plan to expand the use of the digital currency to include third-party fund transfers and cross-border payments.
Since July 16, when Thailand’s digital currency issuance regulations came into effect,The policy environment in Thailand has undergone many changes. Currently, the Securities and Exchange Commission (SEC), Thailand's main cryptocurrency regulator, has legalized the trading of seven cryptocurrencies, and seven crypto companies have been allowed to operate legally in Thailand. Currently, Thailand is also reviewing some companies’ applications for cryptocurrency operations in Thailand. In addition, the country's central bank has also given the green light to some commercial banks' crypto business subsidiaries.
Previously, Odaily has also been paying attention to the attitudes of various countries on the issue of CBDC.The Bank of Spain also issued a policy on the issuance of CBDCresearch report。
The report believes that there are four main reasons why some central banks want to issue CBDC:Reduced demand for use of cash; improved payment system operations; improved monetary policy transmission; combating illegal activities. But is CBDC really a good thing with no harm?
Currently, there are only a handful of countries that issue CBDC. The Central Bank of Spain’s CBDC issuance report once summarized the possible risks of issuing CBDC:
First of all, how to characterize CBDC is a difficult task. If you choose non-anonymous, the central bank needs to shoulder the regulatory responsibility, which increases another regulatory cost besides the regulation of legal currency. If you choose to set it in an anonymous form, the CBDC may be used by criminals, which also increases regulatory risks. Secondly, the introduction of new currencies may cause certain risks and fluctuations to the originally stable financial situation, and the gains may outweigh the losses.
At present, the Bank of Thailand defines the CBDC users issued by it among banking institutions, which is a "wholesale" CBDC only for financial institutions. The launch of the Inthanon plan this time is only a small test of CBDC, and the specific results remain to be seen.
