Siam Commercial Bank (SCB) has initiated the first cross-border payment using stablecoins in Thailand through collaboration with SCB 10X. This new solution, developed with Lightnet, aims to provide simple and fast cross-border payments by utilizing stablecoins and public blockchain technology.
Innovative Payment System
In a press release sent to CoinGape, SCB stated that this innovation represents a significant step in modernizing cross-border payments. By using stablecoins linked to the US dollar or gold, the system seeks to make cross-border transactions faster, more efficient, and cost-effective.
The service is available 24/7; customers can send and receive payments at their convenience, providing greater flexibility compared to traditional banking hours. Users can transact using their local currencies, making the stablecoin system facilitate a seamless transition between digital assets and local fiat currencies.
Security and Collaboration
Security is a crucial element of this new payment solution, with Fireblocks providing the necessary custody solutions to safeguard digital assets. Utilizing Fireblocks’ custody technology ensures that SCB can guarantee the security of the assets being transacted, minimizing the risk of theft or loss.
Michael Shaulov, CEO and Co-Founder of Fireblocks, stated that with Fireblocks’ secure custody technology, cross-border transactions become not only faster and easier but also more secure.
This added layer of protection is an essential factor as the financial sector rapidly adopts digital assets while security breaches continue to rise.
Digital Asset Innovation and Regulation
The stablecoin transfer project is among the first to complete the regulatory incubation program of the Bank of Thailand (BOT), which ends in October 2024. The incubation program regulated by the Thailand Securities and Exchange Commission (SEC) allows financial institutions to experiment with new financial solutions and products.
Launched in 2024, the SEC’s digital asset regulatory incubation initiative enables financial firms to test cryptocurrencies within a legal framework. This initiative received positive feedback during public consultations, opening new opportunities for financial innovations in Thailand’s digital asset market.
The completion of the incubation process for SCB’s stablecoin project indicates that the system has passed regulatory assessments and is ready for commercial market entry. This development is also viewed as a significant step towards the adoption of blockchain technology in the traditional banking sector.
Corporate Expansion Plans
Following the successful launch of the system for retail users, SCB and Lightnet now plan to extend the service to corporate clients. The goal is to offer businesses the same advantages currently enjoyed by individual customers, including lower transaction costs, faster payments, and 24/7 availability.
Eliminating previous financing requirements and operational inefficiencies will facilitate cash flow management for corporate clients, especially those engaged in international trade. This will provide businesses with a seamless and cost-effective solution for both incoming and outgoing transfers.
The stablecoin-based solution is regarded as a significant step in the digitization of financial services in Thailand, with expectations of similar projects increasing in the future.
