Thailand’s oldest bank wants to invest in a local crypto exchange, to the tune of more than half a billion US dollars.
Siam Commercial Bank and Bitkub: Old bank and crypto innovation
On November 2, 2021, crypto exchange Bitkub announced in a statement that Thailand’s oldest bank, Siam Commercial Bank (SCB), is set to acquire a 51% stake in the company by the second quarter of 2022. The deal is worth 17.85 billion Thai baht, or about $537 million. The deal still needs to get the green light from Thailand’s SEC and the country’s central bank.
Bitkub is one of the few crypto exchanges operating in Thailand to have received SEC approval. Its founder and CEO, Jirayut Srupsrisopa, emphasized the growth of the exchange and the important role it plays in the country’s future economy:
“Bitkub is no longer just a startup. It is becoming a necessary infrastructure for the 3.0 financial industry in Thailand.”
SCB, meanwhile, has been diving into cryptocurrencies long before this acquisition, via its venture capital firm SCB 10X, which invests in blockchain and DeFi startups. SCB 10X has invested in well-known companies in the cryptosphere like Ripple, BlockFi, and Alpha Finance.
Thailand and crypto-currencies: a particularly active regulator, exchanges under duress
The Thai SEC had approved in June 2021, guidelines for cryptocurrency exchanges, prohibiting them from supporting four types of tokens: memes tokens such as dogecoin (DOGE), fan tokens, non-fungible tokens (NFT), and governance tokens such as Bitkub Coin (KUB) which is the native token of the Bitkub exchange.
The SEC also proposed in August 2021, regulatory provisions aimed at, among other things, prohibiting crypto companies such as exchanges, from using investors’ assets for the “benefit of another customer or other persons” :
“Seeking to derive benefits from customers’ fiat currency is prohibited, except in the form of deposits with commercial banks.”
More and more banks are adopting different strategies to take on cryptocurrencies. Some banks might follow the example of Siam Commercial Bank, which decided to acquire a 51% stake in a crypto exchange. Others may prefer to follow the strategy of banking giant Standard Chartered, which will have its own crypto exchange via a joint venture created by SC Ventures and BC Group.
