A bond market self-regulatory organization in Thailand is planning to create a bond token to speed up corporate bond settlement in the country.
The Thailand Bond Market Association (TBMA) said it has received the green light from Thailand’s Securities and Exchange Commission to develop a private blockchain that will be only accessible for parties in the bond market, such as registered issuers, investors, and depository organizations.
According to a news report from Bangkok Post on Monday, the TBMA said the development process will be divided into three stages and will start next month. The TBMA further explained it will first create a blockchain-based platform for listing and sharing bond information such as interest rates in a distributed manner.
During the second phase, the platform will add in new features to enable bond deposits, which is estimated to take nine months for completion, the report said. The TBMA indicated it will eventually develop a bond coin on top of the blockchain platform in the next 12 months to tokenize assets so that they can get cleared and settled.
Chaitat Prachuabdee, executive vice president of the TBMA said the new infrastructure is expected to improve the transparency of corporate bond information and can potentially shorten the transaction time from currently 7 – 10 days to just 1 – 3 days.
The effort follows previous news which reported Thailand’s national stock exchange also built a blockchain platform to widen the access to capital funds for domestic startups in a bid to enhance the efficiency of Thailand’s equity market.
Yet Thailand is not the first country that is looking to blockchain for settling securities. Switzerland’s primary stock exchange also released its plan for building a digital asset exchange in order to tokenize and transact traditional securities.