6 days ago
National crypto sandbox for tourists in the offing
Digital asset exchange operators have welcomed a joint effort between the Securities and Exchange Commission (SEC) and the Bank of Thailand to launch a crypto sandbox to allow foreign tourists to use digital assets in Thailand, saying the new initiative would drive crypto adoption across Thailand.
The regulator has launched a public hearing on a proposed digital asset regulatory sandbox tailored for the tourism sector. The initiative plans to allow foreign tourists to convert digital assets into baht for use during their stay in the country.
The proposal also aims to promote innovation, enhance digital asset utililisation and support the broader economy.
"This crypto sandbox builds directly upon former premier Thaksin Shinawatra's Phuket sandbox proposal from late last year. Both share the core concept of allowing Bitcoin and cryptocurrencies as payment methods in tourist areas to drive adoption," said Nirun Fuwattananukul, chief executive of Gulf Binance.
"The new sandbox proposal is no longer just limited to Phuket, but applies nationwide".
The Thai joint founder of the world's leading crypto exchange and the operator of Binance TH sees that the key difference between the two initiatives is implementation.
"While the original Phuket proposal was conceptual and regionally focused, this initiative has formal backing from Thailand's primary financial regulators. This represents an evolution from an experimental concept to a structured regulatory framework with proper oversight," he told the Bangkok Post.
"What's significant is Thailand's consistent vision in moving from the initial proposal to concrete implementation with regulatory safeguards. This demonstrates our commitment to leading cryptocurrency adoption in the region while ensuring consumer protection and compliance standards," Mr Nirun added.
A TESTING GROUND
Under the proposal, tourists holding digital assets will be able to exchange them for baht via licensed digital asset operators and use the converted funds through e-money service providers to pay for goods and services across Thailand, the SEC said in a statement.
The services will operate within a controlled sandbox environment overseen by the SEC, the Bank of Thailand, the Anti-Money Laundering Office and other regulatory agencies, it added.
According to the SEC, the sandbox will serve as a testing ground for digital asset conversion services specifically for foreign tourists. However, digital assets themselves cannot be used directly as a means of payment and converted baht must be spent via regulated e-money platforms, said the statement.
The sandbox is open to licensed digital asset exchanges, brokers and dealers, subject to SEC approval to operate under the sandbox. Once approved, participants can provide services for up to 18 months, with possible extensions subject to the SEC's consideration, it noted.
Services under the sandbox are restricted to foreign tourists visiting or temporarily residing in Thailand. Operators must comply with the type of licence granted by the SEC and establish interoperability with e-money service providers regulated by the central bank.
"This will allow tourists to spend their converted baht electronically, such as via QR code payments."
All sandbox participants must adhere to specified regulations, including eligibility criteria, service scope, spending limits for tourists and anti-money laundering requirements. The framework aims to ensure both innovation and consumer protection within a tightly regulated environment.
The SEC emphasised that the sandbox is part of a broader effort to leverage digital finance to enhance Thailand's competitiveness in tourism while ensuring financial system stability and security.
MONEY LAUNDERING FEAR
Bhummikitti Ruktaengam, vice-president of the Tourism Council of Thailand (TCT), said the SEC and the central bank have yet to properly inform tourism operators and stakeholders or clarify the regulations of the crypto sandbox prepped for Phuket.
He said the public in Phuket has hardly heard about the public hearing that the SEC is conducting at the moment.
"We're not opposed to this scheme, but the government should assure that it has prepared the entire ecosystem for cryptocurrency use before starting this programme," he said.
Mr Bhummikitti said there are a few concerns regarding the sandbox programme in Phuket, particularly the prevention of money laundering using the cryptocurrency exchange as a tool, as the island has been overwhelmed by illegal foreign businesses.
"We would like the regulators to clarify the rules, allowing people to understand the same principles for this programme," he said.
