The Government of Thailand is looking to utilize the blockchain technology for various services and applications such as cross-border payments, document authentication and supply chain financing.
The Bank of Thailand’s governor, Dr. Veerathai Santiprabhob, revealed this during the Bloomberg ASEAN Business Summit which held at Siam Kempinski Hotel, Bangkok Thailand on July 12, 2018.
According to Dr. Santiprabhob, the central bank was reviewing how to integrate blockchain technology into its applications to appropriately suit vital economic sectors of the country.
While speaking at the business summit which was tagged “Developing a Financial System for the Future,” the governor stated that employing the blockchain technology in cross-border payment services would help to “improve regional financial connectivity and facilitate smoother cross-border financial services.”
The application of blockchain technology in these government services involves a review which will be carried out through a supervisory sandbox by the central bank of Thailand. Dr. Santiprabhob said: “The sandbox serves as a platform for financial institutions and FinTech firms to test new technologies and operating standards in a safe environment before the products and services are launched to the general public.”
Dr. Santiprabhob talked about how embracing the blockchain technology, and other innovations such as biometrics as a framework for financial operations in the country will play a significant role in curbing corruption and fraud while helping to protect crucial information of financial institutions. He stated that:
“Adoption of modern technologies like biometrics and blockchains can help safeguard financial information and reduce the number and magnitude of fraudulent activities.”
The governor also spoke about the central bank’s plan to develop and review old regulatory guidelines and rules and come up with suitable ones. According to him, the new regulations will be intended to encourage “competition and innovation.” Dr. Santiprabhob revealed that:
“The Bank of Thailand is also undergoing regulatory reform to review outdated rules and regulations, to facilitate ease of doing business and ensure that our regulations do not impede competition and innovation and contribute to high costs of financial services.”
Government of Thailand Showing Interest in Blockchain Technology
The government of Thailand appears to be demonstrating its commitment to adopting the blockchain technology and cryptocurrency as this is not the first time that top financial agencies will make moves to explore the advantages of blockchain in the country. In June, the Securities and Exchange Commission (SEC) of Thailand approved the Initial Coin Offering (ICO) projects of 5 companies.
The governor of the central bank revealed that the Bank of Thailand was working closely with the country’s financial sector, with an initiative from Thailand Blockchain Community to integrate blockchain technology in banking operations.
Also in June, during a speech delivered at the 2018 Nomura Investment Forum Asia which held in Singapore. Dr. Santiprabhob said: “Another project in the pipeline is the “Project Inthanon” in which the Bank of Thailand and banks will co-develop a new way of conducting interbank settlement using wholesale central bank digital currency or CBDCs. Like other central banks, our goal is not to immediately bring CBDC into use, but rather to explore its potential and implications for back office operations.” The aim of the CBDC initiative is to use blockchain applications to quicken the time required to allocate bonds to retail investors by reducing it from 15 to 2 days.