The Bank of Thailand has delayed the trial of its retail Central Bank Digital Currency (CBDC) until late 2022, pending the preparedness of connected partners to participate.
The central bank first set testing requirements for a foundation track and then an innovation track. According to the bank, the foundation track testing was supposed to start in the second quarter of 2022.
Financial institutions, merchants, customers, and others are anticipated to participate in the digital baht testing, with over 10,000 people scheduled to take part, according to Kasidit Tansanguan, the central bank’s assistant director for financial markets.
According to him, the central bank has addressed a retail CBDC with associated parties multiple times, and there are several stakeholder needs. Consequently, Mr. Kasidit believes the central bank should construct the infrastructure and wait for linked parties to be ready before testing the digital baht in a closed system late next year.
The foundation track includes testing fundamental financial operations such as digital baht payments and transfers. He added that the central bank would go on to test under the innovation track when the testing is finished.
Mr. Kasidit said, “The testing for both tracks will take more time to ensure digital baht functions and explore innovative use cases help people and the country’s economy.”
The senior director of the economic and policy department, Sakkapop Panyanukul, stated the digital baht development intends to turn the nation into a cashless society by improving payment system efficiency, lowering operating costs, and boosting creative technology growth. According to him, the development would help minimize social disparity and give Thais a comfortable way to do business.
Mr. Sakkapop explained that the central bank is unwilling to compete with stablecoins, which are different from digital currencies. According to him, stablecoins and cryptocurrencies are mostly utilized for investments.
In 2019, the central bank began developing CBDC as part of the Inthanon initiative. The Hong Kong Monetary Authority was utilized in the second phase, dubbed Project Inthanon-Lionrock.