By Nathan Ferguson
The Bank of Thailand (BOT) is all set to start a central bank digital currency (CBDC) pilot project for retail consumers. The organization of a potential real-life use case of the respective “Retail CBDC” is to be carried out on a limited span.
As noted in the declaration of 5th August on the BOT’s official page, the institution will evaluate the advantages as well as the related hazards through the respective pilot project to be in a better position to structure the relevant policies as well as to adapt the design of the digital currency accordingly in the coming time.
Thai Central Bank Moves Prepares for a CBDC Pilot
The pilot phase is divided into two sections. In the initial one (known as the “Foundation track”) the testing of the CBDC will be done in the cash-related operations such as recompensing for services and products, within the limited span of up to 10,000 retail consumers. In the respective experiment, 3 firms will take part, including 2C2P, Siam Commercial Bank, and Bank of Ayudhya. The testing period is expected to commence at this year’s end while it will be prolonged till the next year’s mid.
In the 2nd section (called “Innovation track”), the concentration of the organization will be on the proposals of innovative utilization for central bank digital currency. The public and the private sector will both have the opportunity to propose the Retail CBDC’s use cases through a “CBDC Hackathon,” to be spanned between 5th August and 12th September. The chosen members will be provided with mentorship by skilled financial organizations.
No Sign of a CBDC Launch Yet
Simultaneous to this, no plans have been shared by the Bank of Thailand for the issuance of a Retail CBDC up till now, as there is a requirement for a lot of considerations dealing with the benefits as well as the risks related to the overall financial system.
On 4th August, the financial regulator of the country, the Securities and Exchange Commission (SEC), granted approved operating licenses for up to 4 providers of the services related to digital assets, notwithstanding the chaos experienced by Zipmex (a crypto exchange that operates in Thailand). Zipmex put a stop to the customer withdrawals in cryptocurrency during the previous month. In 2021’s start the crypto market of the country surged by 600%.