Stock Exchange Of Thailand Looking To Jump Into The Crypto World

Officials at the Stock Exchange Of Thailand (SET) are interested in taking advantage of the growing popularity of investing into cryptocurrency, and now have plans to enter the space themselves. 

The Bangkok Post reported how the SET is aiming to open up an authorized cryptocurrency exchange this year. It is first planning to apply for a digital asset operating license from Thailand’s Finance Ministry. If all the plans go through, the SET would join an exclusive club of stock exchanges who also have a separate cryptocurrency exchange.

The Vice-Chairwoman of the SET’s board of governors, Pattera Dilokrungthirapop, said members of the exchange are planning to submit applications to be digital asset brokers and dealers once the new crypto exchange goes live.

SET vs. Other Licensed Exchanges?

The decision by the SET to enter into the cryptocurrency space makes it an intriguing option for those looking for an exchange.

Bitkub Group chief executive Jirayut Srupsrisopa admitted the SET does have more capital and trust than a traditional exchange, but digital asset exchanges in Thailand will be able to bank on at least five years’ worth of experience in the space.

The Bangkok Post said a number of securities firms in the country are purportedly interested in becoming digital asset brokers and dealers. This Saturday, January 19, the SET and its members are set to run an investment expo for digital businesses. Pattera said the event will give information about the SET’s policies regarding cryptocurrency exchanges and show different trends in robotic trading and AI.

Thailand’s Interest In All Things Crypto

A number of government officials and citizens in the Asian country have expressed an interest in cryptocurrency.

CryptoGlobe wrote that Thailand’s first domestic bank, the Siam Commercial Bank, became the first financial institution on RippleNet to utilize ‘Multi-Hop.’ The multi-hop technology gives the Bank the ability to “receive and forward on a payment without a bilateral relationship between the originator and beneficiary institutions."

In October, authorities said they caught the culprits who carried out a wide-sweeping bitcoin scam that swindled a Finnish investor out of roughly $24,468,000. News media said Prinya Jaravijit was arrested after flying back into Thailand from the United States. He reportedly decided to come back home after his passport was revoked.

Four Exchanges Represent 96% of Crypto Derivatives Trading, Report Shows

Four exchanges represent 96% of the total crypto derivatives trading volume. According to figures from CryptoCompare’s December 2019 Exchange Report, OKEx is the leading exchange in crypto derivatives trading.

The report shows that during December, OKEx registered an impressive $3.32 billion in daily trading volume. This represents 35.8% of the total market share in crypto derivatives.

Following closely behind is Huobi, with $2.7 billion in daily trading volume and a 29.16% market share. Further behind is BitMEX, with a volume of $1.9 billion and 19.7% market share, and Binance, with a volume of $797 million and 11.4% market share.

Out of all the big exchanges listed above, OKEx was the only one that saw its volume go up. Trading a total of $99.6 billion in crypto derivatives in December, OKEx registered a growth of 11% in comparison to the previous month. Huobi registered $76.5 billion but showed a 14.5% decrease in volume from November, and BitMEX accounted for $51.1 billion and was also down 28.8%.

OKEx was also the third biggest exchange in Ethereum perpetual futures. Following behind it was BitMEX (44%) and Binance (23.2%), OKEx controls roughly 20.8% of that market with a $1.7 billion in trading volume.

Market Leader in Crypto Derivatives

Although BitMEX is leading in the ETH and BTC perpetual futures, OKEx is the top exchange when it comes to crypto derivatives. Founded in 2017 and based out of Malta, OKEx is one of the biggest cryptocurrencies in the world. In fact, in May 2018 OKEx was the world's largest cryptocurrency exchange by reported turnover.

Having launched its own native token in early 2018, the OKB token, the OKEx team is actively working to improve its platform and services. OKEx has its own blockchain in the final stages of testing, OKChain, and has future plans to release a decentralized exchange, OKDEx. Both these products will expand the OKEx ecosystem and add features to its OKB token.

Despite these developments, OKEx continues to focus and give special attention to the derivatives market. In recent months, the company released a data analytics platform for derivatives trading, Bitcoin futures contracts margined with Tether (USDT), and Bitcoin options trading that are scheduled for public launch this month of January.

Despite the success, many in the industry have questioned OKEx’s trading numbers, accusing the company of wash trading, fake volumes and market manipulations.

Growing Popularity

The crypto derivatives market has shown fierce growth since the Chicago Board Options Exchange (CBOE) started trading bitcoin futures back in 2017. Crypto derivatives have grown throughout 2019, both in numbers and in product variety, and most exchanges who adopted such types of products have registered unprecedented growth.

Despite their bad reputation, commonly pointed as the cause behind the fall of America’s former energy and commodities firm Enron, derivatives have brought growth and attention from the general public to the crypto industry. And this trend seems to be ongoing, as just two weeks ago the Chicago Mercantile Exchange (CME) released the long-awaited Bitcoin options, sparking tremendous interest from investors and fueling the busiest crypto derivatives trading day of 2020.

The launch of Bitcoin futures by the CBOE and the CME caused significant price spikes, and promoted the interest of the general public on cryptocurrencies, opening it to a wider audience. It is possible futures will make the crypto market more stable, as in traditional finance it has been shown to make the underlying asset balance out price fluctuations.