Key Takeaways
- Thailand’s Finance Minister announced the government will issue a “digital investment token” in the next two months.
- The $150 million token will allow investors to earn a higher return than they would on bank deposits.
- Thailand joins a growing list of countries experimenting with blockchain and cryptocurrency for their financial products.
Thailand’s Finance Ministry will issue a $150 million crypto investment token within the next two months to raise funds directly from members of the public.
According to a Bloomberg statement citing Thailand’s Finance Minister, Pichai Chunhavajira, the “digital investment token” G-Token, which will be distinct from traditional cryptocurrency, will be offered to retail investors for as little as $3.
Reduce Entry Barrier for Retail Investors
The country’s Finance Minister further revealed that the Thai government will back the crypto investment token to guarantee its level of credibility and security that you won’t easily find in the traditional cryptocurrency market. The move to launch a digital investment product highlights the government’s commitment to digitization and innovation of financial products that cater to a broader demographic by reducing the entry barrier to favor retail investors.
The Bloomberg report said that about $150 million worth of G-Tokens will be offered in a program that allows investors to earn a bigger return on investment than they would from a regular bank deposit. The token’s purpose is to raise public funds under the existing budget borrowing plans instead of using a debt instrument. The Bank of Thailand recently reduced its key interest rate to 1.75%, prompting savers to start looking for higher-yielding alternatives when regular bank deposits offer returns of about 1.25% to 1.5%.
The Initial Phase is a Test
The decision to issue government-backed crypto investment tokens comes hot on the heels of a declaration early this year by Thaksin Shinawatra, father of Prime Minister Paetongtarn Shinawatra, urging the government to consider “issuing stablecoins backed by government bonds.” The G-Tokens will adhere to the regulations of the Bank of Thailand, and experts believe it could help promote secondary bond activity by enhancing accessibility and increasing liquidity. The initial phase will be a test, with future issuances possible depending on demand.
The move to issue a government-sanctioned cryptocurrency also comes at a time when nations and financial institutions are broadening their global embrace of blockchain technology and cryptocurrencies as investment vehicles. Similar moves have been made in Asian countries like Japan and Malaysia, where governments have demonstrated an increasing willingness to facilitate digital asset innovation.
Conclusion
With the introduction of a government-backed crypto investment token, Thailand joins a growing list of countries exploring different types of blockchain-based finance products. While the trend may have existed earlier, many experts believe it has accelerated due to US President Donald Trump’s friendly outlook towards the digital asset industry and the evolving US crypto stance, which is beginning to influence international finance policies.
Frequently Asked Questions
Is Thailand a crypto-friendly country?
Thailand aims to become a central digital trading hub with crypto-friendly regulations. The Thai government is revising regulations to relax cryptocurrency oversight and stimulate its digital trading market.
Do you have to pay crypto tax in Thailand?
The Thai Revenue Department considers cryptocurrencies to be digital assets. They are subject to personal income tax and capital gains tax. All crypto transactions are taxed based on their nature – trading, mining, or receiving cryptocurrency as payment.
Is crypto regulated in Thailand?
To operate a crypto business such as an exchange, one must obtain licenses from the Thai SEC, can only trade cryptocurrencies that the SEC lists, and must comply with relevant AML and terrorism financing regulations.
