The crypto bubble: Can Bitkub ride out the negative sentiment?

Jirayut Surpsrisopa, aka Top, the young founder of Bitkub has gained a reputation for his shrewd strategy and effective public relations. He has made an impact through his talks, exchanging of ideas and his ability to close deals, especially by signing contracts with big names such as the Mall group. He has added to his goodwill by pledging support for the Thai national football team to help them qualify for the World Cup final. We can see adverts of Bitkub at almost every street corner in Bangkok, be it expressway, public billboards, convenience stores and even on your computer screen.

The Bitkub slogan reads, “When you think of digital money, you can count on Bitkub!” It sounds similar to the wordings of a famous convenience store, which you might often hear when shopping there. 

The marketing blitz has only raised doubts and further antagonised critics as well as the authorities. They see the trading and the persuasion campaign as another kind of cult, which might lure the innocent to become victims of a possible scam.

Sondhi Limthongkul, a provocative commentator, recently dedicated his airtime on his Friday programme, warning about the possibility of a scam in cryptocurrency trading and urging the government to intervene sooner rather than later.

Need for close oversight

I am not going to judge anything by cherry picking. I have researched the content and discussed all possible scenarios with some of my friends in the field of criminal justice agencies.

Many are very concerned about these new kinds of technologies and the lack of appropriate measures or suitable laws to protect the innocent. They say the government and the concerned parties have closely watched the exponential growth of Bitkub for quite some time. The problem is the Thai government still lags far behind in dealing with these kinds of business ventures.

Many people believe that the recent fine imposed on some members of the Bitkub board is something the authorities had waited patiently for a long time. This is due to the fact that they could not find any misconduct by Bitkub since the company started operations. However, this incident has led to the Bitkub coin losing almost 50 per cent of its value.

There was no sign of any speedy recovery in trading last week amid the crisis caused by the Russia-Ukraine war as well as the hike in interest rate by the US Fed to fight inflation.

Despite the number of big challenges before Bitbub, the company’s advertising is still allowed to invite those interested in multiplying their money by joining the company’s trading platform and investing in Bitkub. It is understandable that the government as well as concerned parties, such as the Anti-Money Laundering Office, Stock Exchange of Thailand, the Bank of Thailand as well as other concerned agencies are trying to close any gap or loophole in the laws sooner rather than later. 

The fine that they imposed on Bitkub is considered very small and a soft step by the government’s gatekeepers. One of the main reasons why Bitkub is still allowed to trade freely is because the government lacks efficient laws to to deal with Bitkub. So we can expect that in the coming months or so, there might be some new gazette announcements of newly written laws or more suitable measures to deal with these kinds of scenarios.

If we leave Bitkub here and carry on discussing about the future of Cryptocurrency in Thailand, we can foresee that the government seems to be very reluctant to put forward or fully support this kind of business. They are instead building up some barricade to protect those who tend to be victimised. If we do not take things for granted, the government has to do the right things and carefully implement any policy with strong caution. We can understand the various constraints and consequences that the government is wary of, particularly when several big elections are approaching -- Bangkok governor and general election. More importantly, at the upcoming censure debate the opposition factions might put the government in the hot seat.

Lessons learned 

Cryptocurrency is not widely used or legalised. Only the central American country of El Salvador accepts bitcoin for commercial use and as a legal tender. Even without being influenced by Warren Buffett’s critical comments about cryptocurrency, it is evident that the future of digital money is still murky and revolves around those who trust and rely on the digital currency. That is why some critics might often say that it looks like a new kind of cult, in which the cult leaders will try to build up their fame by creating their own currencies. The more popular your currency, the more you gain. A company cannot succeed if the money they create are not accepted or reliable enough to be commercialised in the big markets.

The origin of cryptocurrency, as far as I am concerned, can be traced to those who wanted to challenge governments and some powerful nations that are dominating the global economy. So they tried to find a new way of doing things.

It is not easy to catch a big fish with bare hands, I suppose!

Amorn Wanichwiwatana
Special to The Nation 

(Amorn Wanichwiwatana, D.Phil. (Oxon), is a political scientist at Chulalongkorn University)