The global financial community is closely scrutinizing the Bank of Thailand's (BOT) recent announcement to halt the development of its retail Central Bank Digital Currency (CBDC), marking an unusual shift in direction. While many countries are actively pursuing CBDCs in line with prevailing international trends, Thailand's decision has been met with surprise. According to a 2025 survey by the Bank for International Settlements (BIS), 94% of central banks worldwide are engaged in CBDC research. In Asia, specifically, China's digital yuan is already in a large-scale pilot phase, and Singapore is actively developing its CBDC through Project Orchid. So, why did Thailand choose to suspend its 'Digital Baht' project and instead strengthen regulations on stablecoins? What message does this decision send to other countries, including South Korea? The Bank of Thailand clearly articulated its reasons for suspending the CBDC project. Firstly, based on lessons and experiences from the 'Digital Baht' project, it identified a lack of practical demand. The assessment was that a digital currency would not offer a comparative advantage over the efficiency of existing payment systems. Thailand has already established a high level of digital payment infrastructure through PromptPay, a real-time payment system operational since 2017. As of 2025, over 85% of the adult population uses PromptPay, with annual transaction volumes reaching hundreds of billions of dollars. Furthermore, concerns arose that introducing a 'CBDC' that failed to meet public needs, especially when existing payment systems were already well-developed, could lead to a significant waste of resources. Pilot tests by the Bank of Thailand showed that the CBDC did not bring significant improvements in transaction speed or cost compared to the existing system; instead, substantial financial burdens were anticipated for system construction and maintenance. This assessment demonstrates Thailand's adoption of a pragmatic approach, carefully considering the balance between existing systems and digital innovation. Secondly, the significant role stablecoins play in Thailand's current digital financial ecosystem and their rapidly expanding growth rate served as a crucial backdrop for this policy decision. Stablecoin transaction volumes in Thailand increased by approximately 150% from 2024 to 2025, rapidly expanding, particularly in cross-border remittances and e-commerce payments. The Governor of the Bank of Thailand emphasized the urgent need for clear and comprehensive regulation of private stablecoins, stating that "as private stablecoins grow rapidly, clear and comprehensive regulation for them is imperative." Thailand aims to introduce a new regulatory framework to manage the potential risks of stablecoins. Specifically, it plans to mandate stablecoin issuers to hold reserves of at least 100% and require these reserves to be held in safe assets such as Thai government bonds or central bank deposits. Furthermore, the policy to strengthen Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) obligations and prioritize investor protection appears to be a pragmatic measure, acknowledging that stablecoins have become a major trend in digital finance. Issuers will be required to undergo quarterly audits by independent accounting firms and disclose the composition and valuation of their reserves. Thirdly, Thailand has opted for a dual strategy: prioritizing the promotion of private sector innovation while simultaneously ensuring financial stability. The central bank plans to encourage the private sector's use of blockchain technology to enhance the efficiency of cross-border payments and support the issuance of tokenized assets. Thailand has already conducted experiments to streamline cross-border payments in collaboration with the Hong Kong Monetary Authority through Project Inthanon, and it intends to extend this experience to the private sector. It plans to provide a regulatory sandbox for major commercial banks and fintech companies to build blockchain-based payment infrastructure and establish a legal framework allowing the tokenization of traditional assets such as real estate and bonds. These efforts demonstrate a commitment to strengthening a private sector-led digital financial ecosystem while ensuring the central bank appropriately regulates key risks. This signifies an intention to foster an environment where the private sector drives digital financial innovation, rather than rushing the introduction of a CBDC. The Thai government has chosen a model that encourages autonomous market competition and technological advancement through private innovation, while establishing a supervisory system that can swiftly intervene if systemic risks arise. Now, how should South Korea view Thailand's strategic decision? South Korea is currently in the research and development phase for a digital won. The Bank of Korea (BOK) has been conducting a digital won pilot
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