Following a ban on crypto activities in February this year, it seems the Bank of Thailand is now beginning to change its mind on blockchain technology.
The announcement was made at the Nomura Investment Forum Asia by Dr. Veerathai Santiprabhob, the Governor of the Bank of Thailand. It states that the bank will begin testing applications of blockchain technology in collaboration with 14 Thai banks which, earlier in March this year, formed the Thailand Blockchain Community. Seven other businesses and state-owned enterprises will be involved in the tests.
Bank of Thailand representatives outlined financial applications that will be tested, including supply chain, bond issuance and letters of guarantee.
The project, which will begin with a pilot of blockchain-based letters of guarantee, is expected to initiate operations in the third quarter this year. Some goals that the collaboration hope to achieve include developing a way to enable faster and cheaper inter-bank settlements using digital currency.
New Regulations Amidst Wider Blockchain Adoption
The test follows new financial regulations that came into force in April this year. The legislation, dubbed the Payment Systems Act, ensures that the Bank of Thailand is able to regulate the development of new Thai payment systems. It requires that cryptocurrency exchanges, ICO’s and crypto brokers register with the Thai Security Exchange Commission.
The announcement comes amongst a wider adoption of blockchain technology by the traditional banking sector in South East Asia. In February this year Bank of Indonesia announced its plans to launch a digital currency and both Singapore and the Philippines are actively exploring blockchain technology.
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