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Cryptocurrency adoption is here to stay in Southeast Asia. Digital asset trading is growing so fast that even profiteering exchanges are struggling to maintain their backend operations when transactions surge.
As policymakers in Southeast Asia scramble to come to grips with decentralized finance, they are looking to central bank digital currencies, or CBDCs, as a way to maintain control of the financial system. Thailand said it will roll out its own CBDC for consumers in the second quarter of 2022, joining other nations—Cambodia, Indonesia, and Singapore.
Cambodia’s CBDC project leads the way with nearly 6 million users that performed transactions worth USD 500 million in the first half of 2021. Will CBDCs gain popularity in Southeast Asia more broadly? Global crypto adoption was up 881% in Q2 2021, and countries like Vietnam, Thailand, and the Philippines were among the fastest growing markets.
With proponents of CBDCs extolling their potential to foster broader financial inclusion, digital currencies may gain traction if CBDCs end up being used by Southeast Asia’s unbanked population. But it remains to be seen whether government trials can successfully convince citizens to use state-implemented digital currencies for their everyday purchases.
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