Bank of Thailand (BoT), the country's central banking authority, is eyeing the adoption of blockchain technology in its interbank clearance and settlement system.
In a speech made at an event in Singapore on Wednesday, central bank governor Veerathai Santiprabhob indicated that developing a wholesale central bank digital currency is currently in the pipeline as part of the country's wider efforts in trialing blockchain technology in various sectors.
The project, dubbed Inthanon, seeks to create the bank's own blockchain-based cryptocurrency to make interbank transactions both faster and cheaper.
The initial goal of the trial, according to Santiprabhob, is to understand the potential of this technology before moving to bring CBDC into larger scale of real life use.
He said in the speech:
"Like other central banks, our goal is not to immediately bring CBDC into use, but rather to explore its potential and implications for back-office operations. These efforts should pave way for faster and cheaper transaction and validation due to less intermediation needed compared to the current systems."
The effort follows Bank of Thailand's several existing work in exploring blockchain technology.
As previously reported by CoinDesk, in March, 14 Thai banks joined the central bank in March in piloting a shared blockchain platform to digitize letters of guarantee in the country. That work, according to Santiprabhob in the latest speech is "expected to become operational in the second half of this year."
In addition, Santiprabhob said his agency is also testing a proof-of-concept that uses a blockchain platform to issue bonds digitally, and could reduce "bond allocation to retail investors from 15 days to 2 days."
The proof-of-concept is "almost complete," he said, adding that a product is anticipated to launch in the "very near future."
Thai baht image via Shutterstock