Central Bank Digital Currency Tests kick start in 2022-Bank of Thailand

Central Bank Digital Currency Tests kick start in 2022

It is important to mention that with preliminary testing protocols slated to start Q2 2022, the Bank of Thailand has set its agenda for a retail central bank digital currency.

Public comments have been called by the Bank of Thailand on the prospective CBDC project, according to the Press release on Friday.

The CBDC thesis of the Bank of Thailand has been published as part of its preliminary report of the project and of which they explained the rationale of their prospective action. Also, Monetary sovereignty and private stability are being threatened by the success of private stablecoins ..

Thai Baht Digital (THT), a stablecoin issued by Terra has been declared illegal by the Thailand’s apex bank. The apex bank backed the reason of their action, on the law that provides that is within the prerogative of the apex bank and no other to issue currency.

Cost benefit analysis, with engagement of stakeholder will be utilized by the Bank of Thailand to identify the risks, opportunities, risks and challenges that are associated with a digital currency that is considered sovereign

For the BoT, “flight to quality” — i.e., consumers preferring CBDCs to fiat currency during market upheavals — remains a major risk factor. Thus, the central bank is proposing the addition of withdrawal limits among other transaction friction protocols to reduce the possibility of bank runs whenever periods of market uncertainty emerge.

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