Bitcoin firm licensed to trade in baht
Another bitcoin trading company has emerged as a legally registered entity in Thailand after obtaining e-commerce registration with a local district office in June, with its digital currency trade restricted to baht. The registration was obtained despite doubts over the legality of the virtual currency.
Coins (Thailand) began its service early this year after it was awarded with an e-commerce registration licence by Huay Khwang District Office on June 20 after hiring a local legal advisory team to comply with Thailand's rules and regulations concerning e-commerce, said Ron Hose, the Philippines-based chief executive officer and founder of Coins Co.
The District Office considers the company's bitcoin trading operations as a form of commodity trade rather than currency. Mr Hose insisted on its legitimacy in operating the business, adding that the US Internal Revenue Service has also treated digital currencies as a property for tax purposes.
Set up in 2013, the company's headquarters are based in Singapore but its technological development office is located in the Philippines. Its bitcoin began trading in the Philippines in January and Thailand in June.
The company has become the second bitcoin exchange service provider in Thailand after Bitcoin Co obtained approval for its digital currency business, according to the CoinTelegraph website.
But the Bank of Thailand issued a letter to Bitcoin, saying the foreign currency exchange cannot be done without an operating licence granted by the central bank. Bitcoin, therefore, announced that it would provide exchange service only in Thai baht.
That is why Coins is trading only in baht, with no foreign currencies involved in the firm's digital currency trade since day one, said Mr Hose.
"The letter that the Bank of Thailand sent was made public and it stipulated that exchanges should not be made in other currencies. Obviously, we want to make sure that we operate within the confines of the law so we have decided to only trade in the baht in Thailand," he said.
Although the company did not consult government officials before commencing its digital currency trade, it has taken an individual approach by reviewing Thai laws and the central bank's public statements in order to comply with existing rules and regulations, said Mr Hose.
He, however, supports the idea of regulating digital currency trade to increase the industry's credibility and enhance consumer safety.
"We adhere to responsible regulations, ones that allow the industry to continue growing and ensure companies behave in a professional manner, while protecting consumers at the same time," said Mr Hose.
Coins' mission is aimed at increasing financial inclusion among the population in emerging markets, he said, noting that digital currencies, not only limited to bitcoin, dramatically reduce remittance and transaction fees compared with those of traditional banking services.
The company is focusing on penetrating emerging markets and has a plan to expand its business operations in the near future regionally, said Mr Hose. No more details disclosed.
Jaturong Jantarangs, the Bank of Thailand's senior director of the payment systems policy department, said a company providing bitcoin exchange against the baht does not require approval or a licence from the central bank because bitcoin and other virtual currencies are not recognised as legal tender in Thailand.
However, it has to comply with other related laws such as the Civil and Commercial Code, Consumer Protection Act, and Anti-Money Laundering Regulations, he said.