Topic: The Largest Crypto Exchanger in Thailand has been acquired by Commercial Bank (Read 307 times)

This commercial bank already knew what it was doing. Certainly, they won't do this if they aren't knowledgeable about the risks and all the possible repercussion of their decision. For sure, they already assessed the risks and made a strategic planning before they have made the acquisition of crypto exchange. For a commercial bank, a central organization, their moves and actions should be well calculated and thought of to avoid untoward incidents such as losses. I think they have prepared and thoroughly checked whether it would be beneficial to them or not. They wouldn't do it if it would not give them significant impact, right?

This is a courageous move for a central organization. Surely, they know the possibilities of hacking and all the other schemes and crypto before doing this. Hence, I commend them for taking a bold move. Stabilization of profit and security enhancement would definitely be on their list to provide a better services for the customers as well as for their company's welfare. They would have a hard time at first figuring out how to make the collaboration of entirely two different things harmonious, but after that, they could earn a lot of profit. They just have to hire an expert in the field of crypto and let them do the work for the betterment of their company  After all, business is business. They have to make things on their favor so that the risk they have decided to take would be worth it. 

I look with suspicion at the central banks’ acquisition of cryptocurrency exchanges. I do not think that banks seek profit because of this acquisition, but I fear that they have other goals beyond, for example, narrowing the areas of decentralization and privacy by acquiring crypto sectors by imposing KYC, for example, As you know, third-party services can eliminate the privacy and decentralization of cryptocurrencies by enforcing KYC.
However, I hope my words are not true and that banks and governments are starting to realize the importance of Crypto and that it has become a reality for them to adapt to.

Talking about users, many indicators are assessed.  From the news, it is actually not clear whether the bank's management will run the exchanger from a management perspective.  However, based on what I understand that investors or shareholders should not be the same and technically involved in management because it would violate the rules of good corporate governance.  Management and shareholders should not be the same.  Regarding user data that is KYC and will be easily tracked by banks, it has actually happened on well-known exchanges such as Binance and legitimate exchanges in my country must also be KYC, meaning that it is not a new issue to consider.  However, in my opinion, here the bank is only an investor for the benefit of profit.  The other elements are only supporting.

Maybe it is not a bad idea, because when an exchange is adopted by a bank that means the exchange will be linked to the bank and users who are making use of the bank will be able to find it easier to trade on that exchange and withdraw their money straight to the bank without having much delay on it.

But, people who prefer decentralized exchanges and maintaining their privacy are not going to like such an exchange, because since it has been acquired by a bank the exchange will now start becoming centralized if it is not, and they will start requiring information about users when they’re registering on their platforms. And there wouldn’t be anything like peer to peer or decentralization on the exchange. So, it is up to the users whether it is going to suit their needs or not.

Banks is totally opposing on what crypto exchangers been doing but this time they had acquired it? For sure this would be talking about more profits because they do see
significant benefits that they could get since people are now focusing mostly on decentralization and its impossible that they are acquiring it for nothing since we know
on whats their stance against these platforms which are totally dealing with crypto which is the  main enemy of centralization.
There's always a motive on each action which had been done.

I doubt that it was an easy decision to make, and it could be a bit of a problem if things go south as well. However we are talking about a cash cow here. A crypto exchange rarely ever loses money, has a very low cost of operations and could make a ton of money if they are liked.

In my nation there are so many of them, it is a great way to make money and they spend every single income they have back into marketing to grow bigger and have a bigger market share, because it is such an easy way to make money. Sure if you are spending your money into marketing then you are not profiting, but they are growing so even if it is not profit they are getting, it is the value of the company that grows bigger.

I myself still don't believe whether this is purely as a pilot bank or an experimental effort to support the cryptocurrency system or just purely looking for profit that may be abandoned after that because we know until now most banks corner crypto

Joining the favourite instead of going against it is a smart move that is what actually happened because if cryptocurrencies still exists for another 10 years or so most of the banks in this world will be closed by that time due to lack kf transactions and customers so they are finding the ways now to work alongside cryptocurrency payments.

I figured regulation is the way most countries can push back against crypto because an outright ban is hard to implement and more likely for people to circumvent. If you make the case that your coin should be centralized through digital exchanges ran by central banks, I'd imagine new adopters to crypto would be more inclined to give up control of their private keys to a 3rd party. There's a lot of money to be made through crypto exchanges unfortunately, so central banks wanting a piece of it was expected. The solution, obviously, is to never use exchanges but new users will still find the platforms attractive.

I think the fact that banks get interested in exchanges and buy them doesn't mean that they're getting crypto-friendly. It means that they're not blind, and they see how interested people are in trading, and how profitable crypto exchanges are. So it's an investment for them, basically, to buy an exchange and get those profits, but it doesn't mean they believe in Bitcoin or other cryptos, support them in any way, recognize them as money or anything. It can be a very profit-oriented decision of buying what seems financially promising.

I think everyone around the world has seen that VCs are taking a keen interest in cryptocurrency markets and are putting their money in budding crypto porjects. The large commercial banks don't want to lose this opportunity, having an exchange operating at the local level is very useful as you have to comply with laws of the local country and local people feel easier to trade on it and even fiat withdrawals are too easier, also marketing and advertisement for these exchanges becomes much easier as they have to advertise merely on a few platforms like television which the whole country watches and you can easily get new users onboard. 

When I read your post I was confused at first where you said that the exchange was ordered to shut down for about 5 days. It made me think that the exchange was completely shut down and you meant to say that it was shut down 5 days ago, not until I clicked the coindesk link that you provided and read the article itself and it made me understand that the exchange was ordered to shut down for five days to iron out the bugs that was affecting their website.

I don’t think the bank would just rush in and pay for majority stake in a cryptocurrency exchange if they don’t have a clue on what cryptocurrency is all about. Before taking a step like this I believe that they must have made some research and understood everything on how cryptocurrency works, before they decided that it was right for them.

Definitely, they have done their homework before they venture into this kind of decision, because we are talking a huge amount of money. They won't go into this business if they know they will be on the losing end. With their move, we are expecting that they will be more open to crypto businesses in their country and that means, more crypto users, which of course, is always welcome in the community. This news is an encouraging news for their neighboring countries which are not yet open to this concept.

This will be a trend.

A very major commercial bank in Australia has also started to branch off into the crypto exchange business.

The best path forward for these industry giants would inevitably be through acquisitions/mergers. It gives them a technical edge as well as an awareness advantage. Certainly great news for the crypto industry.

Yeah it seems OP's concern is about security of the exchange and I am also confident a bank level management can easily run a crypto exchange more smoother. When a bank is entering into a all new business definitely they might have done all the required field work about what to do and how to do. So, how they are going to run a crypto exchange definitely is an unnecessary question from an enduser side.

I am also expecting any announcement from Thailand government about legalizing bitcoin as a legal tender which might help triggering very strong bull run in this crypto space for sure. Anyone could enlighten me on such possibilities?

This is because they see the benefits of acquiring the crypto exchange, I think they understand the risks that will be faced because the risks is always there in every kind of business not only in the crypto world.
If this is successful it will be followed by many commercial banks in other countries which is crypto friendly.
I actually curious if this action would make crypto more centralized? because in my opinion with the power they have they are able to control many things about crypto, especially in that country.

You do not have to think twice about the decision of Banks to buy majority shares in Exchanges, because it is a power play. A majority share will give them control over those companies and they will simply transition those exchanges into Banks. (If you cannot beat them, you buy them..right)

We will see a lot more of these transactions in the future, because Banks will never miss an opportunity to make a profit and to exploit their clients with high fees. (Banks will simply use their money to avoid disruption) 

It is true that every innovation will create disruption, so the massive use of cryptocurrencies as an alternative to expensive cross-border bank transfer fees is the current solution.  As a result, commercial banks will suffer losses for the profits they should receive and even people prefer crypto as a means of cross-border transactions.  Quick and easy.  At present it may be difficult for commercial banks and almost impossible to replace their services in crypto because their basis is fiat but acquiring a crypto exchange is the most likely way for them to make profit from these crypto services.

Once banking networks believed crypto might eat our profit. Even several banks revealed details on loss due to the increase in the usage of cryptocurrencies on cross border transaction needs. Now looking the growth of cryptocurrency market the only way to benefit out of it is through businesses. As a result the banking networks are now focusing on the acquiring of cryptocurrency exchanges. Even the banking network require high security. So, when something gives them profit surely they'll have more security on it.

I agree bro..they are afraid of inter-leaving opportunities at least there is an additional profit in the wild main profit sector (interest lending and borrowing or deposit services) even though they have shares that are traded and traded..not like crypto which is flexible and decentralized..will it help when commercial banks facilitate crypto like bank services in general? Of course this will make me happy bro


maybe it will be a little side when banks see long-term profits..become a new style of investing..there are several advantages of crypto over other investment instruments

It's true what you said, Indonesia, I think it's quite welcome because it's legal..

there is 1 news that is quite familiar in my country which is covered by the newspapers.. one of them is exchanger zipmex which received a second disbursement of funds from Krungsri Finnovate, a company under the supervision of Bank of Ayudhya in Thailand. After getting series A funding sources last January, now series B fundraising is being given again, Friday (3/9/2021)

please read the full source

https://www.liputan6.com/bisnis/read/4648790/bursa-asset-digital-zipmex- Accept-Suntikan-dana-dari-thailand-usd-41-juta

hopefully other banks can make cooperation like this..

I doubt that a commercial bank, when deciding to purchase a cryptocurrency exchanger, was guided by the desire to support Bitcoin and other cryptocurrencies. Banks are interested in cryptocurrency only from the point of view of the possibility of making a profit. Moreover, banks are not interested in risky investments. They calculate everything and if such a decision is made, it only testifies to the profitability of this type of activity.

This is really a strange situation compared to the practices of my country.

I am sure, cryptocurrencies are not legal tender in Thailand but at least the government ha cleared about their stand for being neutral? Not sure about that. (I remember when China was banning all crypto related activities, few countries like Taiwan or Indonesia announced like inviting crypto enthusiast for running crypto business but not sure Thailand was one of them).

A bank is acquiring crypto business means that the government is positive about crypto related business.
I hope crypto will find another round of boom with the help of any positive announcement from Thailand government.

And I guess running a crypto exchange for a bank is not a big deal among all security vulnerability. So, you may not concern on that.

Well, if you acquire a decisive majority in a business you essentially also control the management. That is just how equity works. If you have the biggest say in a company financially, you can just fire the management if they don't act in the best if your interest. The management knows it, doesn't want to get fired so mostly they serve your interests. That is also duty by the way to some degree and that is also why there is the separation of management and control, which eventually boils down to management being controlled. By whom? By those who have a stake in the company big enough to substantially raise their voice and take influence.

Expect Bitcoin, and by extension crypto, to become more corporate in the following years as the entryways to the crypto world become manned by the financial world.

Expect a neutralization of the privacy benefits of cryptocurrency, increased regulation and the shutting down of decentralized currencies as they prepare to push crypto into fully-fledged security similar to stocks, bonds and futures.

This will have the same effect as government regulation

Satoshi specifically started up Bitcoin to avoid the very same financial system that caused the 2008 recession via providing a brand new way to do business in. This development goes against that.

That is my opinion.

51% stake majority has been acquired by them, it means they have a right to change the management although I don't know if they change the management or not. If you think about profit, yes, I'm sure that investing in crypto will provide very high returns and risks as well. Many companies that previously lost money have become successful after investing in crypto. Aren't we too? The highest profit of our asset portfolio is in the crypto market.

right decision to take a step forward from other countries..with Bitcoin..

in contrast to some countries whose citizens openly own bitcoins.

In my country, there is no domestic bank or central bank claiming to acquire bitcoin, only as a medium of exchange as a 3rd party after market/exchange.

they know blockchain is an economic revolution..
Financial institutions like it or not have to follow in the footsteps of this technology.

and forcing them to understand and accept the owner's risk not only makes them profitable there are times when the graphics are not friendly but this is the Future

The challenge for companies that are already large and well-known is to provide comfort and security for sure. even for exchanges that have been trusted, have experienced problems with asset security and user wallets. I don't really know about the Thai bank company. So I can't judge whether they will be completely safe or not. I hope they hire professional security. because it involves a lot of people's money.

Makes sense for sure and a crypto exchange could yield bigger profit percentages
than traditional FIAT banking.

It looks like they have aligned themselves with the crypto space to take advantage of
the incoming interest in crypto and to be potentially offer FIAT style services in the
crypto space similar to what Coinbase announced yesterday.

As with Coinbase it looks like they see now huge growth in crypto

[Coinbase] Bitcoin Collateral = FIAT Loans

Part of the purpose of Bitcoin or True Cryptocurrency is to help us depart from the old corrupt, opaque, lawless and centralized system not to hand people back to the system. It's really surprising sometimes how people can be used to defend the system that enslave them. No matter how hard you scream in their ears to prevent them from being charmed or hypnotized and taken back into their slave camps as run away slaves, they wouldn't listen because the meat or shiny things in what is used to trap them are too strong for them to resist

Acquiring some stakes does not mean taking over management, the exchnage is still managed by old people. After all, the stake buyer is the oldest bank that may have been a trusted service to local residents for years. Of course it will give a special impression.

Talking about profit, it seems that the bank made the right decision. I saw their coin price grow by 125% in the last 24 hours. An instant profit.

Well, there are more than one possible reasons, but I think it is more business than being a true fan of crypto. Commercial banks are always after the money. So it is very possible that they will enter into the world of crypto because it is what is trending right now. There's money there. So this is not actually intriguing. There are already many banks that have joined the cryptocurrency market in one way or another.

Banks don't have to know the technical and security sides of crypto. They have the money to hire the best people who could handle it for them.

As to volatility, crypto exchanges don't lose because of it. They are always gaining.

Does anyone remember poloniex being acquired by circle which was said to have connections to goldman sachs in 2018.


Ethereum was known to be affiliated with JP Morgan.

Craig Wright's startup had $200 million invested in it (possibly by banks).

There is a long list of events similar to these that have occurred over the years.

....

Does anyone remember these things happened, aside from myself.

I am not aware of the politics in Thailand but this news is not that surprising. The countries in the region present an inordinate amount of unbanked people and, at the same time, a few with good access to foreign currency but mostly all the rest having to deal with their local coin, which in essence tend to be quite shitty. 

But, probably the main thing here is how the local regulator has allowed this purchase. Risky business tend to go with greasing hands.

If anyone wondered about how banks will adapt to the crypto future now you know... they will simply buy or make their own crypto exchange! Of course, that can be some other service as well, but they know where the money is!


Maybe they are struggling for different reasons, or maybe they have money and they wish to invest in the future! For whatever reason they chose to do it I believe it will pay off for them one day, and it's definitely a good thing for crypto users over there!

The bank which you are talking about could be struggling for different reasons which is why they decided to support BTC and other popular cryptocurrencies in order to acquire profits in the long-term.

If this is really the case, it is a smart move considering the fact that Thailand doesn't really have a tough stance against cryptocurrencies.

I think this might be positive and negative both. For example when we talk about the negative side :
There is always a fear of manipulation

When we talk about the positive side :
We might see many more banks and centralized exchanges coming forward to doing the same making the crypto market and the whole centralized banking system more integrate.
Which could provide us with better results in the future, faster transactions, stronger connections and more approvals from other sides as well. This can increase the scope of cryptocurrencies. The people who are already engaged with the banks will have advantages in lieu of trading etc..

This can be a mutualistic relationship between the two of them and can go further for a really long time. Therefore I think this might be really good.

Possibly Thailand is the second Asian nation who is friendly about bitcoin. It's a positive news that a commercial bank has acquired majority stakes in a crypto exchange. I am happy that the general negative perspective about cryptocurrencies is changing - slowly but surely!

I am sure it's a concious decision by the bank because a commercial bank is usually listed in stock market and they can't take decisions out of blue. This decision must have been approved by the shareholders body as well as the regulatory bodies. So it's a positive news!

It's safe to assume that entrepreneurs/businessmen know how difficult it is to make an exchange secure; but the fact is, it's safe to assume that running a cryptocurrency exchange is really really profitable if ran well, hence why they did the acquisition. The same way how Warren Buffett's Berkshire Hathaway acquired Barrick Gold, a gold mining company, despite the fact that he's not a fan of gold. What matters to them mainly is the cash flow.

While other banks may be stuck with their centralized system, Siam Commercial Bank is one step ahead.  Because when new technologies and innovations disrupt the previous system, we should not be against and regard the innovation as a threat, but the best attitude is to study it well and adapt.  SCB has gone through that process while other banks may feel egotistical that fiat will be impossible to replace, meanwhile SCB has acquired a 51% stake in its country's crypto exchange.  This means that now they have a new line of business from innovation which is a challenge for the current monetary system.

I have doubted that the owner of this commercial bank already knew how crypto works.

But I think they might face difficulties upon looking for a platform where they can trust to hold their fund and it seems Thai cryptocurrency exchange Bitkub to their place is one of those reliable and can be trusted as they think.  There could be always a risk and making money isn't a guarantee here and Banks understand the risk, even there are people who trust banks and save their money there and I think that was the concept that the bank of Thailand was figured out.  Therefore, before they face this potential risk they're already aware of it.

Sounds good, this could be another first step and other banks will do the same, we know how much we can get profit in staking, how much more if you have a lot of capital to invest, they are playing money here that could be potentially an easy profit.

After the government of El Salvador accepts Bitcoin as their legal tender, then there are much other positive news that enlivens crypto exchanges around the world, one of which is the approval of the Bitcoin ETF by the SEC,

Governments and investment regulatory authorities have slowly begun to understand the meaning of crypto which is not as bad as they previously thought.

Today, in Thailand, the country's oldest bank has acquired a majority stake in the country's crypto exchange. What really intrigues me is why commercial banks acquire crypto exchanges? If the reason is purely business profits that have been analyzed previously, that's a common thing. But are they sure about the decision? The level of security that is very vulnerable by hackers and the highly volatile crypto market, is it in line with their core business which prioritizes stability?

The challenge is after the acquisition, the exchange experienced a bug problem until it was closed 5 days at the decision of the SEC of its country.

What do you think?

Source: https://www.coindesk.com/business/2021/11/02/thailands-oldest-bank-acquires-majority-stake-in-countrys-largest-crypto-exchange/