On 20 October 2026, the Bank of Thailand (BOT) published a Consultation Paper outlining principles for regulating businesses related to THB Stablecoin, a digital asset pegged 1:1 to the baht. The proposed regulatory approach covers issuance, reserve asset management, wallet provider services, transaction monitoring, and consumer protection.
The proposal aims to enable financial innovation using Distributed Ledger Technology (DLT) responsibly, without undermining the stability and trustworthiness of the payment system.
The proposal is currently under public consultation before BOT recommends that the Ministry of Finance designate related businesses as licensed services and issue regulatory guidelines. Therefore, these are not yet enforceable regulations.
Thairath Money summarizes key points from the BOT document, including background, policy concepts, benefits of THB Stablecoin, ecosystem structure, licensing requirements, and post-licensing supervision measures.
According to the Payment Systems and FinTech Policy Division of the BOT's Payment Services Policy and Oversight Group, Thailand already has efficient, low-cost retail payment systems like PromptPay that cover domestic economic activities comprehensively. However, DLT and tokenization technologies are opening opportunities for new financial services.
The BOT recognizes the importance of supporting innovations that can improve efficiency, reduce costs, or overcome limitations of existing systems, provided appropriate risk management measures are in place and integration with existing financial infrastructure is feasible.
Regarding THB Stablecoin, the BOT views it as a form of digital currency pegged to the baht and fully backed by assets, potentially suitable for certain payment cases—especially DLT-based transactions and tokenized asset settlement.
The proposed regulatory principles cover three key dimensions. These are:
1. Risk management under normal and crisis conditions: Providers must maintain the coin’s value and liquidity, support high-volume redemptions, have cybersecurity measures, and implement transaction monitoring to prevent money laundering and illegal activities.
2. Openness to usage and interoperability: Support connection with existing payment systems and other tokenized payment instruments to foster competition and diverse financial services, within an appropriate regulatory framework.
3. Efficiency and value creation: Support use cases that reduce costs, increase speed, enable new transaction types, and potentially ease cross-border remittances.
The BOT emphasizes that THB Stablecoin should complement, not replace, existing payment systems. Also, using DLT does not inherently guarantee better performance than current systems in all cases.
The BOT document explains that tokenized money can take various forms, each with distinct legal frameworks and ecosystems, grouped as follows:
For Tokenized Deposit, the BOT notes it remains under existing regulation for commercial banks and specialized financial institutions, whereas THB Stablecoin requires specific rules to address risks from open system structure and role separation.
Policy-wise, the BOT proposes limiting the number of issuers initially to maintain coin credibility and reduce liquidity and user fragmentation risks, while allowing unlimited licensed wallet providers meeting criteria to promote competition and consumer choice.
The BOT sees THB Stablecoin supporting payments and financial transactions leveraging DLT technology, offering three potential advantages over existing systems.
Users can acquire coins through various channels: purchasing from wallet providers at a 1:1 baht-to-coin ratio, with issuers minting coins accordingly; or buying via licensed digital asset operators regulated by the Securities and Exchange Commission.
Once held in wallets, coins can be used to pay merchants supporting them, transfer to other verified wallet users, or settle prices for financial and digital asset transactions in capital markets for retail trades.
When holders wish to redeem coins for baht, they may sell back to wallet providers for redemption from issuers at 1:1, or sell via digital asset operators at market prices which may differ from the peg.
However, the BOT stresses actual benefits depend on service models, system readiness, and related regulations. The focus is on supporting THB Stablecoin use cases that clearly add value or reduce existing system limitations.
The BOT proposes an open-loop THB Stablecoin ecosystem clearly dividing service providers into two types:
This structure separates responsibilities among business types, while allowing multiple wallet providers to compete and innovate on the shared ecosystem. Initially, the BOT proposes limiting issuers for close supervision and liquidity risk control, while wallet provider licensing rounds will be open without number limits if criteria are met.
The BOT proposes providers meet minimum standards in risk management, system security, asset custody, and consumer protection, with requirements differing by issuer and wallet provider roles.
Issuers must be prepared to handle risks in normal and crisis scenarios, especially liquidity risk, mass coin redemption, and system security.
They must also have IT risk management, emergency response and business continuity plans, consumer protection measures, and exit plans ensuring appropriate user rights protection.
Wallet providers must segregate user coins from company assets, prohibit using customer coins for other purposes, maintain auditable transaction records, and establish complaint handling, user assistance, and resolution processes for payment or transfer errors.
For anti-money laundering and financial crime prevention, they must conduct customer identification and verification, prevent coin transfers to unverified wallets, secure wallets and digital keys, and comply with relevant risk management and consumer protection standards.
The BOT proposes evaluating applicants based on their ability to create benefits from THB Stablecoin, financial stability, management expertise, and risk management readiness, with distinctions between issuers and wallet providers.
1. Ability to create value and expand services: Applicants must demonstrate that issuing THB Stablecoin can generate new benefits such as supporting automated payments, 24/7 transactions, tokenized asset settlement, or cost reductions compared to existing systems.
2. Financial stability: Parent company or major shareholders must have strong financial standing, capable of sustaining operations without income for at least six months.
3. Management expertise and local accountability: At least one director and the chief IT officer must have direct experience with DLT or payment systems. Additionally, there must be at least one Thai director with decision-making authority in Thailand, and the chief IT officer must work full-time in Thailand.
4. Appropriate risk management systems: Must have mechanisms addressing liquidity risk and coin run scenarios, IT security systems, business continuity plans, consumer protection measures, and exit plans.
1. Development plan with issuer collaboration: Applicants must have plans to cooperate with at least one issuer to develop services and innovate.
2. Consumer protection capability: Must be prepared to safeguard user assets and provide assistance and remedies when problems arise.
3. Anti-money laundering and fraud prevention systems: Must implement KYC/KYM and customer due diligence standards comparable to e-Money businesses, and support real-time on-chain transaction analytics to detect risky transactions.
4. IT and digital key management security: Must have robust wallet and key management systems, including access control measures for systems and data.
Beyond licensing qualifications, the BOT proposes operational conditions providers must follow to maintain coin credibility and protect holders.
The BOT proposes issuers hold full backing assets in bank deposits initially, diversified across multiple banks to avoid concentration risk.
Coin holders must be able to redeem coins for baht at a 1:1 ratio within one business day. Backing assets must be distinctly segregated from other assets to protect holders’ rights if issuers face financial distress or insolvency.
For transparency, issuers must disclose backing assets and outstanding coin supply daily, and arrange at least annual external audits.
The document also mentions potential future consideration of other backing assets, such as short-term government bonds, contingent on business readiness and regulatory amendments.
Issuers must not pay interest or benefits directly or indirectly to THB Stablecoin holders, ensuring the coin functions as a payment instrument, not a savings or investment product offering returns.
The BOT proposes issuers implement whitelisting so coins can only be transferred to wallets with verified identities.
Issuers must be able to remotely freeze, seize, or destroy coins if illegal or non-compliant use is detected, such as involvement in unlawful transactions or bridging/wrapping that moves coins beyond regulatory oversight.
Wallet providers must not service or connect with foreign digital asset exchanges outside Securities and Exchange Commission regulation, preventing circumvention of foreign exchange controls.
Both parties must have clear roles and coordination processes for receiving alerts, fact-finding, and implementing preventive measures against fraud or financial crime.
Upon detecting suspicious transactions, issuers must be ready to suspend or destroy implicated coins, while wallet providers must be able to restrict access to risky wallets, within legal frameworks.
Licensing does not mean operations proceed without oversight. The BOT proposes close early monitoring of issuers to assess adherence to business plans, risk management, and approved conditions.
Key monitoring points include business plan progress such as service launch, user base and transaction volume growth, service continuity, risk management, and legal compliance.
For issuers, BOT proposes on-site inspections and ongoing supervision covering business operations, IT systems, and legal compliance.
Wallet providers will be supervised under standards comparable to other payment service providers, focusing on risk prevention and consumer protection.
If providers operate non-compliantly or pose risks to users or the system, the BOT may order corrective actions or additional measures, and if unresolved, consider service termination under legal provisions.
The BOT's proposal establishes a comprehensive regulatory framework covering business selection, ecosystem structure, backing asset management, baht redemption, transaction monitoring, and post-licensing oversight.
Key elements include limiting issuers initially, requiring 100% bank deposit backing, prohibiting interest payments, and mandating identity verification, anti-money laundering, and user asset protection systems.
However, the Consultation Paper is still in the public feedback stage from 19 to 28 October 2026, with actual implementation pending legal procedures and related regulations.
Source information Bank of Thailand
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