Pay Solutions will seek approval from the Bank of Thailand (BOT) to become the first online payment service provider in the country that legally uses a cryptocurrency to pay for goods and services, its CEO said.

Pay Solutions CEO Pawoot Pongvitayapanu said his firm would seek approval to use a Stablecoin type as a means of payment for goods and services once the BOT issues regulations for using digital currencies as payment means.

The BOT currently prohibits the use of cryptocurrencies as a means of payment for goods and services for fear that their lack of stability would affect the country’s economy.

The BOT is now working with the Securities Exchange Commission (SEC) and the finance ministry on regulations for using a type of stable digital assets, such as Stablecoins, as a means of payment. Stablecoins are digital currencies designed to be less volatile than cryptocurrencies by pegging their market value to an outside asset, such as the baht.

Pawoot said the BOT would allow only digital currencies that would not cause risks to the entire economic system to be used as a means of payment, and he is confident that a Stablecoin type would be safe because it will be backed with the baht.

“So, Pay Solutions aims at becoming the first one to legally provide online payment system using a digital currency,” Pawoot said.

He said Pay Solutions would carry out a test using a Stablecoin type for payment in a closed ecosystem as a pilot project.

He said his firm is drafting details of the experiment of using a Stablecoin type to be sent to the BOT for approval.

In the initial phase, the company would use around 10 million baht ($310,000) to back a Stablecoin type and it would be used among companies in his group for making online purchases or for collecting reward points for goods deliveries from, for example.

The experiment would come with regulations to safeguard the use. Users can pay Stablecoin from their e-Wallet registered with Metamask and the payment would be made via the blockchain system Binance Smart Chain (BSC), which is widely used globally.

The operation plan will be ready for sending to the BOT for consideration within one month, he added.

Napongthawat Photikit, director of the BOT’s Payment Systems Policy Division, said the central bank is now considering whether to allow the use of digital assets, which will not cause risks to the system, as a payment means. He said Stablecoin is considered a “non-risk” digital currency because it is pegged with real currency value.

He said the SEC is now in the process of compiling opinions on the issue after it held a public hearing on February 8 on the use of cryptocurrencies as a means of payment.