Using crypto for payments is very risky, Thai Central Bank warns

By: Ali Raza
Ali Raza
Ali plays a key role in the cryptocurrency news team. He loves travelling during his spare time and enjoys… read more.
on Jul 9, 2021
  • The Bank of Thailand has warned against the use of cryptocurrencies for payments.
  • Bank cited digital asset’s high risk of money laundering and price volatility as reasons against their use.
  • However, the bank is planning to launch its CBDC next year.

While some countries like Argentina are looking to propose laws for the use of Bitcoin for salary payments, other countries are more critical of cryptocurrency.

The Bank of Thailand (BoT) has cautioned against the use of digital assets like Bitcoin (BTC/USD) and Ethereum (ETH/USD) for the payment of goods and services.

Both the payer and receiver are at high risk

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Some enterprises started soliciting payments in digital assets for goods and services. BoT said although some entities have started asking their customers to pay with digital assets, the idea is risky for both the payer and the payee.

Ayudhya noted that the payer and the receiver are facing high risks when using digital assets as means of payment. He stated that these assets have a high risk of money laundering, cyber theft, and price volatility.

The warning is coming at a time when BoT s planning to pilot a retail central bank digital currency (CBDC) next year.

BoT warned against the illegal use of Terra’s baht-denominated stablecoin, but later said it will issue regulations on stablecoin soon.

Thailand doesn’t recognize crypto as a legal tender

The bank said on Thursday that it will be coordinating with Thailand’s Securities and Exchange Commission to reduce such risks to Thailand’s financial system.

Assistant governor of payments systems for the bank, Siritida Na Ayudhya, stated that BoT has been consistently observing the development of digital assets. “The BoT does not support the usage of digital assets as a means of payment for goods and services,” he noted. Ayudhya added that Thailand does not recognize crypto as any form of legal tender.

According to him, the country’s view about cryptocurrencies is in line with many international regulators and organizations such as the Bank of International Settlements (BIS), the International Monetary Fund, the central banks of the European Union, England, Malaysia, and South Korea.

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