May 18, 2022

Bank of Thailand to begin central bank digital currency tests in 2022

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The Bank of Thailand has set its agenda for a retail central bank digital currency with preliminary testing protocols scheduled to begin in Q2 2022.

Thailand’s central bank made this known in a press release issued on Friday calling for public comments on the proposed CBDC roadmap.

As part of its plans, the central bank published a preliminary report detailing its CBDC thesis. Explaining its motivation for creating a CBDC, the Bank of Thailand argued that the success of private stablecoins poses risks to “monetary sovereignty and financial stability.”

Indeed, back in March, Thailand’s apex bank deemed Thai Baht Digital (THT) — a stablecoin issued by Terra — to be illegal. At the time, the central bank cited the country’s law prohibiting any other entity save the central bank from issuing currency in Thailand.

According to the Bank of Thailands’s report, the central bank will begin its CBDC developmental efforts by engaging with stakeholders followed by cost-benefit analysis to ascertain opportunities, risks and challenges associated with a sovereign digital currency.

For the BoT, “flight to quality” i.e. consumers preferring CBDCs to fiat currencyTitle: Bank of Thailand to begin central bank digital currency tests in 2022
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Published Date: Fri, 02 Apr 2021 11:37:38 +0100