Cryptocurrency Market in Thailand: Regulated with a Massive Growth Forecast

Thailand’s cryptocurrency market has seen significant growth and transformation, becoming a major player in the global crypto economy. This surge is primarily due to widespread adoption, a notable increase in digital asset trading volume, favorable regulations offering a comprehensive sustainable framework for crypto assets, and a flourishing ecosystem of digital services.

The combination of crypto-friendly policies, affordable living costs, and a vibrant cultural landscape is making Thailand increasingly attractive to digital nomads. This is further encouraging the growth and dynamism in sectors like decentralized finance (DeFi) and non-fungible tokens (NFTs)​​.

Market Growth driven by a strong general interest in cryptocurrency

Thailand has seen a staggering $116.4 billion trading volume, marking it as a crypto hotspot in 2023. This growth is driven by a strong general interest in cryptocurrency markets globally, with Thailand’s unique position in Asia’s crypto scene being propelled by its vibrant and dynamic ecosystem​​ and the potentially high returns. We also see a rapidly increasing readership for cryptocurrency news magazines..

Based on the Chainalysis Crypto Adoption Index, Thailand is ranked tenth worldwide, indicating substantial crypto ownership and engagement. This is reinforced by the high number of visits to CoinMarketCap from Thailand. The number of individual account holders in top Thai exchanges such as Bitkub, Bitazza, and Orbix is over 2.94 million, constituting 4.27% of the country’s population. This figure surpasses the number of traditional stock exchange account holders, indicating a swift surge in crypto adoption​​.

Crucial Role Government

The Thai government has played a crucial role in this growth by swiftly developing a crypto-friendly regulatory framework. This framework, described in the Emergency Decree on Digital Asset Businesses, B.E. 2561, requires financial institutions to record their digital asset investments and activities. This approach has led to the establishment of seven distinct licenses for various assets and operations, overseen by the Thai Securities and Exchanges Commission (SEC). Such regulations have been pivotal in creating a transparent and regulated environment for cryptocurrencies​​.

The SEC also has introduced new guidelines for advertising by cryptocurrency businesses. These regulations require clear statements of investment risks and a fair assessment of prospective risks and returns in advertisements. This move aims to enhance investor protection and aligns with the global trend towards increased scrutiny and regulation of digital assets following the crypto industry’s volatility​​.

Cryptocurrency in Banking and Taxes

The Bank of Thailand encourages the private sector’s research and development into blockchain technology through its regulatory sandbox program. This initiative allows financial service providers to test and develop innovative technologies in a controlled environment, promoting advancements in digital assets and blockchain applications​​.

Income derived from cryptocurrency or digital tokens is classified as taxable income under the Thai Revenue Code. Transfers occurring in a licensed digital asset exchange are exempt from value-added tax (VAT). The Thai government’s draft Emergency Decree plans to further exempt corporate income tax and VAT for certain digital asset transactions. This demonstrates Thailand’s effort to foster a conducive environment for digital asset businesses while maintaining financial stability and compliance​​.

Innovation and New Entrants

The market is not only led by established exchanges like Bitkub and Orbix but also sees innovation from newcomers like SCB, which introduced the InnovestX investment app. Additionally, partnerships and ventures in the sector are growing, with significant banks like SCB and Kasikornbank establishing ICO portals and entering the venture capital arena through their subsidiaries​​.

Thailand’s burgeoning Web3 sector and its rapid adoption of advanced blockchain technologies underscore its rising significance in the global crypto landscape. The country is experiencing a notable shift, with over 3 million crypto users and a 600% growth in the market in recent years. This surge reflects the dynamism in decentralized finance (DeFi) and non-fungible token (NFT) sectors, indicating a broader and deeper engagement with blockchain technologies.

The growth is further highlighted by the emergence of innovative ventures and projects. Notable among these are blockchain gaming guilds such as GuildFi, 3Landers, and LonelyPop, which showcase the potential of Thailand’s evolving Web3 economy. Moreover, the rise of crypto advisory firms like Cryptomind, which secured the first license to provide digital asset advisory services, demonstrates the increasing institutional acceptance of blockchain technology.