Bank of Thailand to let tourists link digital assets to credit cards for local spending

On Monday, Thailand’s Finance Minister, Pichai Chunhavajira, said that while some countries allow crypto payments via credit card-linked systems, it is not yet allowed in Thailand. He also revealed that the country’s government is considering permitting digital assets to be linked with certain services under strict regulation.

The Deputy Prime Minister said the approach aims to streamline transactions for visitors, with vendors receiving payment in local currency as usual. He revealed that discussions are already underway with the Bank of Thailand (BOT), which is planning to pilot the system before a wider implementation.

Government plans to amend laws to link capital markets to crypto markets

Thailand’s finance minister said the government plans to amend laws to connect the capital market with the digital asset market, which currently operates under separate legal frameworks, namely the Securities and Exchange Act and the Emergency Decree on Digital Asset Businesses. According to Chunhavajira, the reform is designed to give investors greater flexibility, allowing them to transfer funds between two markets conveniently. 

The government official also gave a positive outlook on the Thai stock market, noting its relative stability amid global market tensions. Minister Pichai highlighted that the Thai stock index has seen only minor declines compared to regional peers in the wake of U.S. policy shifts. He mentioned that the inherent appeal of the country’s stocks remains a key investor factor for being resilient even amid severe external factors.

The finance minister revealed that the government plans to revise investment regulations imposed by the Securities and Exchange Commission (SEC) in the stock market to help stimulate Thailand’s capital market. He noted that life insurance companies are currently allowed to invest very little in the stock market. At the same time, other funds with hundreds of billions of baht in assets are only permitted to invest in government bonds.

Chunhavajira believes that it is necessary to amend the rules regarding treasury stocks to make it easier for businesses to partake in such investments. He also said that the role of the Stock Exchange of Thailand (SET) is to encourage long-term investments.

The government official also highlighted the SEC’s authority to file lawsuits related to market offenses, saying a new draft law is already being developed to grant it the authority to submit cases to the prosecutor in major cases. There are also ongoing discussions on whether the SEC should have independent investigative powers or share investigative authority with the police.

Chunhavajira mentioned that the government is also promoting G-Tokens issuance, which will allow retail investors to access government bonds. He highlighted that digital assets can be purchased in units with up to six decimal places.

According to the country’s official, investing in G-Tokens is expected to yield better returns than bank deposits. He also added that issuing G-Tokens will help elevate global awareness of Thai government bonds.

Regulator sets out a framework for G-Token

Thailand’s Securities and Exchange Commission (SEC) has established a regulatory framework for the government-backed digital token. The country wants to focus on the G-Token’s role as an investment and savings tool while explicitly preventing its use for payments.

“We will implement Smart Contracts that prohibit inter-transfers and transfers of tokens out of exchanges to prevent their use as a payment channel, a concern raised by the Bank of Thailand. Current regulations already prohibit digital asset businesses from using assets for normal purchases.”

-Pornanong Budsaratrogoon, the Commissioner and Secretary of the Securities and Exchange Commission, Thailand.

The government’s initiative, which saw the Cabinet approve the G-Token’s issuance on May 13, aims to support financial inclusion and leverage digital innovation within the capital markets. The digital asset is not classified as a financial instrument or security, meaning the Ministry of Finance is exempt from seeking SEC approval for its offering. 

Pornanong Budsaratragoon, secretary-general of the SEC, acknowledged that the regulator’s mandate includes supporting and promoting various investment avenues and embracing technology to enhance capital market efficiency. She added that the SEC’s directive ensures a fair and competitive ecosystem for financial products and services, complete with robust investor protection.

The SEC Commissioner revealed that the agency initiated a 15-day public consultation on its principles and related draft announcements on May 26. The framework will address four key areas, including the G-Token’s characteristics, its offering process, trading services, and the secondary market system, all designed to accommodate future government G-Token issuances.

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