Thailand’s Crypto Ambitions Faces Hurdles as Phuket Payment Pilot Looms

Thailand’s finance minister, Pichai Chunhavajira, has made some positive comments regarding the wider adoption of digital asset payments in the kingdom, but several hurdles remain.

On Jan. 8, Mr Pichai questioned why Thailand should not embrace cryptocurrencies, which are being exchanged globally with strong demand, answered:

“With growing demand and ongoing geopolitical issues worldwide, people are increasingly seeking alternatives to conventional currencies,” he said.

Thailand to Embrace Crypto?

However, “Thailand is not fully prepared for digital currency at the moment,” he said, adding that the country is “trying to create a platform to identify potential users and establish a market where they can exchange and engage.”

He suggested allowing tourists to use local exchanges to make property purchases in Thailand, something that is currently not possible.

“For example, if tourists come to Thailand, they could register their coins on a local platform that ensures verification or allows for know-your-customer protocols. When making purchases, they could pay using coins through an exchange house of their choice,”

“Buyers and sellers would not know what kind of money they are receiving, but those coins would be transferred into the app and could then be converted into Baht via the clearing houses,” he added.

Mr Pichai also confirmed that a crypto payments pilot would be launched in a controlled sandbox environment on the tourist island of Phuket later this year. He emphasized that the experiment would be conducted within existing legal frameworks.

Barriers Remain

However, some barriers remain since Thailand’s central bank remains vehemently against decentralized digital assets, having outlawed crypto payments in 2022.

Additionally, foreigners visiting or residing in the country cannot access local payment platforms or crypto exchanges such as Binance Thailand because they cannot register without a citizen’s ID card.

Moreover, the Thai government is currently in the process of implementing sweeping tax reforms that will impact all money coming into the country from overseas, which could hamper foreign investment.

Finally, Thailand’s digital assets market is undergoing a transition from retail to a more institutional focus, said Binance Thailand CEO Nirun Fuwattananukul in October.

At the time, the Thai SEC proposed rules that would allow institutional-grade mutual and private funds to invest in crypto products such as US spot crypto ETFs, but with limits on retail access.