In a welcomed move for cryptocurrency advocates, former Prime Minister Thaksin Shinawatra recently proposed utilizing Phuket province as a Bitcoin sandbox aimed at boosting tourism by encouraging digital currency spending in Thailand.
Thaksin, regarded as the de facto leader of the ruling Pheu Thai Party, stated that neighboring countries are interested in discussing cryptocurrency with Thailand, seeing it as a potential economic driver. He emphasized Thailand’s readiness to advance in this area, particularly after the U.S. introduced crypto-friendly policies under President Donald Trump.
A cryptocurrency sandbox is expected to launch in October with the collaboration of the private sector. However, challenges persist as the Bank of Thailand (BoT) currently does not permit Bitcoin or other cryptocurrencies as payment methods. Crypto exchanges in the country are regulated by the Securities and Exchange Commission (SEC).
The vision for the Phuket crypto sandbox is to facilitate the use of Bitcoin and other cryptocurrencies in transactions, allowing tourists to spend significantly without carrying large amounts of cash. This initiative would help capture previously uncontrolled funds from foreign visitors.
Experts, including Nirun Fuwattananukul, CEO of Gulf Binance, believe that introducing a crypto-friendly environment in Phuket could enhance Thailand’s global standing and attract tourists, digital nomads, and startups. The sandbox model also offers a way to manage risks associated with cryptocurrencies while promoting innovation.
However, there are notable obstacles, including a lack of an established legal framework to govern the project. Udomsak Rakwongwan, co-founder of FWX, pointed out that many merchants hesitate to accept cryptocurrencies due to difficulties in accounting and cash conversion, as well as the volatile nature of cryptocurrency prices.
Regulatory officials, including Jomkwan Kongsakul from the SEC, recognize the advantages of digital currencies but emphasize the need for appropriate regulations that align with existing laws. Currently, Thailand is pioneering alternative payment schemes focused on enhancing banking efficiency and reducing cross-border transaction costs.
The BoT has been exploring the use of Central Bank Digital Currency (CBDC) since 2018, collaborating with the Hong Kong Monetary Authority to examine payment solutions between economies. The ongoing mBridge project seeks to address challenges in cross-border fund transfers and improve the use of local currencies without relying heavily on the U.S. dollar.
