Thailand bans use of crypto for payments

Thailand’s Securities and Exchange Commission (SEC) announced Wednesday that it is banning the use of cryptocurrencies as a means of payment for goods and services from April 1.

The decision comes two months after the SEC, the Bank of Thailand and the country’s Ministry of Finance jointly said that they plan to ban crypto for payments to avoid financial stability and economic system risks.

The SEC today said crypto operators that provide payment services must stop doing so within 30 days from the effective date of new rules. However, it clarified that the new rules won’t affect trading or investment in cryptocurrencies.

Earlier this month, Thailand’s government also relaxed tax rules for crypto investors. They can now offset annual crypto losses against gains and get a value-added tax exemption of 7% for crypto trading on authorized exchanges.

Thailand, Southeast Asia’s second-largest economy, is also ahead in the game of central bank digital currencies (CBDCs). The country plans to test its retail CBDC later this year as an alternative payment option for the public.

It has also been exploring wholesale CBDC since 2018 under Project Inthanon. The project is currently in its Phase III and is exploring the use of the digital Thai baht in cross-border payments.