Bank of Thailand Postpones its CBDC Pilot to Late 2022

The Bank of Thailand (BOT), Thailand’s apex bank, has unveiled a slight delay in its proposed Central Bank Digital Currency (CBDC) pilot test initially scheduled for the second quarter of 2022. As reported by Reuters, the pilot test will now be carried out in late 2022, giving the bank ample time to get its processes in relation to the digital legal tender right.

As a complement to the consultation on crypto scheduled for January 2022, the Digital Thai Baht is designed to serve as a complement to the physical banknotes and will be issued by the central bank just like the fiat notes. According to the bank’s deputy central bank director Kasidit Tansanguan, the CBDC trial is aimed at evaluating the use of digital Baht in cash-like activities within a limited scale.

The CBDC trial will involve transactions such as deposits, withdrawals, and fund transfers by financial institutions and as many as 10,000 users will be enlisted in the project. The calculated advancement per the postponement will aid the BOT to guarantee efficiency in its pursuits.

“Thailand can still take a gradual step in the retail CBDC to ensure efficiency and prudence as it does have a problem with fund transfers or payments as some other countries,” he said. 

Despite its positive disposition towards a CBDC, the Bank of Thailand has no backing for the use of cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) as a means of payment for goods due to their inherent risks. This disposition, according to an earlier report by TheCoinRise, contradicts the country’s Tourism governor who said crypto is the future of payments.

The proposed launch of the CBDC is not aimed at competing with these nascent asset classes according to Kasidit.

Bank of Thailand Amongst the Many Building CBDC Solutions

According to the International Monetary Fund (IMF), as many as 110 Central Banks around the world are actively researching the development of Central Bank Digital Currencies, and the Bank of Thailand is obviously one out of the numerous.

Amongst the monetary authorities with active and well-publicized advancements in their CBDC pursuits includes Sveriges riksbank, the Central Bank of Sweden, the Central Bank of the Bahamas, the Bank of England, the Central Bank of Nigeria, and the People’s Bank of China (PBoC).

Of those mentioned, the PBoC is arguably the biggest economy whose digital Renminbi project has garnered a lot of national interest through its highly successful and diverse retail trials. The Central Bank of Nigeria’s eNaira, and the Bahamian Sand Dollar are currently functional and rank as the first pioneers in floating official government-backed CBDCs in the world.