Bank of Thailand Tells Financial Companies to Stay Away From Cryptocurrency
RegulationBit News Today2 min read
The Bank of Thailand today issued a public warning to financial companies, advising them to steer clear of cryptocurrencies. The central bank's move follows a sharp rise in crypto activity among Thais and a recent collapse in trading. ## Thai Regulator Raises Concerns
The Bank of Thailand today reminded financial institutions that they should have no involvement in crypto trading. This comes as several exchanges that had begun to ramp up operations in the country have either halted withdrawals or suspended trading completely. The largest Thai bank, Siam Commercial Bank, had announced an alliance with crypto exchange Zebpay just weeks before Zebpay shut down.
In a statement, the central bank said, "In order to promote financial stability, financial institutions must avoid cryptocurrency operations." The bank described the situation as "very worrying" and said it would penalize companies that don't comply. ## Crypto Volatility Rattles Investors
Cryptocurrency prices have been highly unstable in recent months, with the most prominent coins experiencing steep declines. Severe drops in the price of Bitcoin and Ethereum in particular led to concerns in the Bank of Thailand about the potential risks to the country's financial security.
One of the bank's top officials, the governor, said, "We've seen this happen before in other countries, and we've seen how it ends. We don't want to see that in Thailand." ## Thailand Still No-Friend to Crypto
Thailand has not been friendly to cryptocurrencies and other digital assets. The central bank had to shut down several exchanges after that, and specific digital assets were prohibited from use.
Today's warning sends the message that Thailand is not softening its stance on crypto, even amidst a boom in its popularity. This will likely drive many Thai investors to avoid the use of cryptocurrency, as they won't want to risk their positions at banks or with other financial institutions that have to keep the central bank happy.
With the Bank of Thailand putting more pressure on the asset class, the cryptocurrency industry in Thailand is likely to contract back to only the most brazen of players. For the rest, it might be time to move on to a more accommodative jurisdiction.
