If you mention blockchain technology and Southeast Asia in the same breath, most people outside the region will assume you are talking about sustainable tuna fishing. But this is a part of the world with much more to offer the world of blockchain technology than innovative ways of catching fish.
In fact, even if some of Southeast Asia’s blockchain pilots have remained below the radar in Europe, the Far East and North America, there are signs that not only IT pioneers, but also policy makers and industry leaders are now getting on board – and foreseeing ways of harnessing the power of decentralized ledger-based systems.
Arguably, few countries in the Southeast Asian region have shown quite as much blockchain technology-related enthusiasm as Thailand.
This summer, Thailand Post, the country’s state-owned postal service, announced it would begin using blockchain technology to track high-value parcel deliveries, for expensive and luxury items “by the end of this year or early in 2018.” The courier’s director stated, “Blockchain is secure and trusted as only authorized persons are allowed to open parcels.”
The government is also moving to aid blockchain implementation for a range of industries by making amendments to the 2001 Electronic Transaction Act. Thailand’s Electronic Transactions Development Agency says that it is now looking for ways to allow the use of blockchain-powered smart contracts.
In the financial, sector, meanwhile, Kasikornbank – one of the country’s biggest commercial banks – has recently launched a “completely paperless” Letter of Guarantee network in conjunction with IBM Blockchain. The bank says it hopes to boost its electronic Letter of Guarantee issuances to 35 percent by the end of 2018, with blockchain issuances accounting for 5 percent of such transactions.
Meanwhile, Kasikornbank rival Siam Commercial Bank claims to have pulled off a first in Asia by teaming up with Japanese financial service provider SBI Remit for a Ripple-powered, blockchain technology-based solution. The platform, says the bank, will let customers make real-time payments between Japan and Thailand.
Energizing the chain
Meanwhile, in the Philippines, the energy sector is taking a leaf out of Japan’s book – and taking the blockchain initiative. The Philippine government believes that some 17 percent of the country has limited or no access to electricity and some believe that blockchain can provide a solution. Energo Labs, a Chinese startup, has this month announced it will seek to address the issue, with a Brooklyn-style microgrid platform that lets local providers share and sell excess power to one another on a peer-to-peer basis – with all transactions logged on decentralized ledgers.
Per Energo Labs, most power plants generation sites in the Philippines are located at some distance from load centers, utilizing long-distance transmission lines that can “often be damaged and are risky and costly to operate.” Energo Labs’s solution, claims the company, would decentralize generation and let consumers share electricity more effectively.
Further Philippines developments may also be in the pipelines, say analysts in the country. The chairman of the ICT Committee of the Financial Executives Institute of the Philippines, meanwhile, claimed earlier this year that “almost all” of the country’s “financial services institutions are talking about blockchain, and still a lot of them are thinking of implementing it.”
Elsewhere in the region, blockchain and digital currency developments are coming thick and fast. In Malaysia, the central bank has remained guarded in its attitude to digital currencies. In 2014, it moved to point out that digital currencies were not acceptable legal tender. More recently, its governor says he is poised to announce “some guidelines on cryptocurrency” to fight “money laundering and terrorist financing.”
Regardless, many in the country remain very optimistic. Indeed, Australia’s Blockchain Global and XEM creator NEM have just opened a nonprofit blockchain center in Kuala Lumpur that will serve as an incubator, an accelerator and a co-working space.
In Vietnam, the country’s Infinity Blockchain Labs has entered into talks with a group of leading Vietnamese banks with the aim of “making the country’s financial institutions world leaders in blockchain use.”
And in Cambodia, the central bank is about to begin a pilot scheme that could eventually see it adopt blockchain technology for a range of financial services, possible involving local currency. The bank is working closely with Japanese technology provider Soramitsu.
Martin Kendrik, the founder of Cambodian Cryptocurrency, Bitcoin and Blockchain Community says this newly found blockchain enthusiasm in Cambodia’s banking sector is understandable. “Banks can try to kill blockchain, which they did try to do,” he notes. “But they have now realized they can’t kill it, so are desperately trying to catch up and convert everything onto blockchain.”
Thailand will presumably continue leading the way for blockchain developments in the region for some time to come. In fact, an intercontinental blockchain financial technology infrastructure deal has just been put in place for a “super luxury private airport” in the country, while leading bond market players in the country are now considering incorporating blockchain.
Blockchain is still in its earliest stage of development in Southeast Asia, but – especially in Thailand – there is a true sense of belief that the technology could change the way the whole region does business.