BoT Warns Against Illegal Use of Thai Baht Denominated Stablecoins
Mr. Pruettipong Srimachand, Deputy Governor of the Bank of Thailand (BOT) Legal Group, revealed that recent developments have seen the private sector attempt to create cryptocurrencies using underlying assets or fiat currencies as the point anchor to minimize price volatility. These cryptocurrencies are called stable coins.
More recently, a new form of stablecoins using underlying algorithmic smart contracts has been created to replicate the price and movement of various currencies.
It has come to the attention of the BOT that a new stablecoin, THT, has been created overseas on the Terra platform.
A unit of THT is denominated and valued at one Thai Baht. Although THT is not currently used as a medium of exchange, it could lead to fragmentation of the Thai monetary system if THT or other similar stablecoins were to replace, replace or compete with the Baht issued by the BOT.
This would ultimately affect the confidence of the general public in the stability of the national monetary system, which is the cornerstone of all economic activity.
Therefore, any activity involving THT is considered illegal, as the creation, issuance, use or circulation of any material or token for money is a violation of Section 9 of the Currency Act 1958.
The general public should exercise caution and refrain from participating in any activity involving THT, as there are no legal guarantees or protections, and users could also be exposed to the risk of cyber-theft and money laundering.