Thailand is no stranger to blockchain technology. This isn’t surprising, considering the different emerging use cases of blockchain around the world and in different industries. Most recently, the country’s central bank announced the largest blockchain-related transformation in Thailand to date.
In partnership with American tech giant IBM, the Bank of Thailand (BOT) launched the world’s first blockchain-based platform for trading government savings bonds this October 2020. The historic move has already seen $1.6 billion (AUD 2.25 billion) worth of savings bonds issued within just the first two weeks of the launch. “Bank of Thailand’s success with the government savings bond project is the latest example of how blockchain technology can redefine the way businesses operate by simplifying complex processes resulting in fast, transparent, secured and efficient multiparty collaboration,” explained VP for Indochina Expansion and MD of IBM Thailand Patama Chantaruck. “IBM is proud to bring our world-class blockchain platform and IBM Cloud to support Bank of Thailand, and work side-by-side with them in achieving this important milestone for Thailand’s financial industry.”
Using the IBM cloud, the new platform reduces the process of bond issuance from 15 days to just 2 days. This newfound speed in the normally two-week process not only reduces the operational complexity of issuing bonds, but also its overall cost. This is good news for any bond issuers, registrars, underwriters, investors, and other key participants in the country’s bond ecosystem. Apart from the BOT, seven other Thai financial institutions collaborated to develop this secure and efficient blockchain-based platform for government savings bonds. These institutions are the Public Debt Management Office, the Thai Bond Market Association, Thailand Securities Depository Co., Ltd, Krungthai Bank, Bangkok Bank, Kasikorn Bank, and Siam Commercial Bank. According to experts, the entire Thai bond market is valued at more than $400 billion (AUD 562.55 billion).
Thailand has actually been an active adopter of blockchain technology since 2019. That was when the electronic letter of guarantee platform and network went live and was consolidated among 22 participating Thai banks and 15 companies. Today, that platform handles approximately $300 million (AUD 422.18 million) in guarantee letters. Furthermore, Thailand also recently became the home of blockchain-based global trade digitisation platform TradeLens, which was adopted by the Thai Customs Department to improve international shipping activities.
Even the Thai lottery could soon experience its own blockchain transformation. During the 2019 Joint International Conference on Digital Arts, Media and Technology, engineers presented a new lottery system that would streamline the popular gambling activity through the Ethereum blockchain. Being one of the few legal gambling activities in the country, the Thai national lottery is big business. In fact, a guide to Thailand on Expat Bets estimates that around 70% of the country’s adults are gamblers, with only horse racing and the national lottery to spend their legal tender on. Soon, they might be spending Ethereum coins instead of fiat money on the lottery instead.
From the national lottery and international shipping to the hundred-billion-dollar savings bonds ecosystem, blockchain is slowly but surely upending Thailand’s financial markets. As blockchain technology itself develops through its many applications in Thailand and the rest of the world, we can expect to see more blockchain-related transformations in the near future.