Bank of Thailand Governor Announces a 5 Year Wait for CBDC

While numerous countries are picking up on the central bank digital currency trend, it seems like Thailand will not go on-board with the change for a few more years.

In a recent press statement, Veerethai Santiprabhob, who is the governor of Thailand’s Central Bank, mentioned that while the country is interested in adopting centralized digital currency, the development process isn’t easy. The reasoning behind this statement is linked to the complex nature associated with the world’s monetary system, thus making the process time-consuming. According to him, developing and launching a central bank cryptocurrency is considerably easier to do in developed countries, but chances are that developing countries won’t deal with the technology for at least half a decade.

The announcement was made in response to the statements issued by the International monetary Fund Governor Christine Lagarde, who believes that CBDC will be useful for the monetary market. Despite this, implementing such a system also carries several risks.

It is important to keep in mind that so far, the Bank of Thailand has only announced work on a wholesale CBDC, which will be utilized by local financial institutions for the purpose of settling inter-bank monetary transfers alongside cross-border transactions. No statement has been issued on the development of a CBDC that will facilitate transactions made by the public.

So far, reports indicate that the wholesale CBDC development work is underway. Apparently, the Bank of Thailand is basing their project on the Corda blockchain platform, which is a reputed name when it comes down to innovating on inter-bank transfers. Additionally, it seems like eight commercial banks operating in the country are working on the project together. Reports also indicate that the wholesale CBDC project is being developed in two phases. While the first one is bound to be completed by March, the second phase will focus on: “Building upon the findings and outcomes from Phase 1, the project participants aim to further develop the capabilities of the prototype for broader functions including third party funds transfer and cross-border funds transfer.”

Based on everything that has been outlined so far, it will likely take another 3-5 years before a CBDC is available to the public in Thailand, and other developing countries.