Key takeaways
- Thailand’s G-tokens represent a leap in sovereign finance, merging traditional government bonds with blockchain technology to improve accessibility, transparency and cost efficiency.
- G-tokens allow fractional ownership of government debt and easy access via digital platforms, opening up investment opportunities.
- The step-by-step process is fully digital, from KYC onboarding to receiving tokens and eventual redemption. It simplifies how citizens can invest in state-backed financial instruments.
- Issued under Thai law and regulated by the Thai SEC, G-tokens offer government-backed safety and operate within a strict legal framework, ensuring investor protection.
Thailand is transforming its financial landscape with G-tokens, a pioneering initiative to tokenize government bonds using blockchain technology. This bold move marks a significant step toward modernizing sovereign finance, blending traditional debt instruments with cutting-edge digital innovation.
G-tokens empower retail investors by enabling fractional ownership and seamless access through licensed digital platforms, enhancing transparency and reducing operational costs. This initiative not only democratizes investment opportunities in Thailand but also sets a new standard for financial inclusion and technological advancement, reshaping the future of public finance in the region.
This article discusses various aspects of G-tokens, including how to invest in G-tokens, key benefits, how they differ from traditional bonds, taxation issues, relevant regulatory framework and more.
What are G-tokens
G-tokens are Thailand’s government-backed digital tokens, a digital form of traditional government bonds. Issued by the Ministry of Finance, these tokens use blockchain technology to fractionalize public debt instruments while maintaining the essential financial features of standard bonds.
The G-tokens are expected to be issued in July through an initial coin offering (ICO) portal chosen by the Public Debt Management Office (PDMO) under the Ministry of Finance. Initially, G-tokens worth about 5 billion Thai Baht (about $153 million) will be issued.
On May 13, 2025, the Thai Cabinet approved the issuance of government bonds as G-tokens. Leveraging the existing public debt management framework, this initiative seeks to make government bond investments more accessible to small investors. Deputy Prime Minister and Finance Minister Pichai Chunhavajira said that the Cabinet endorsed a proposal from the PDMO to introduce digital tokens as a new way for the public to invest in government bonds.
Pichai said, “Traditionally, the PDMO issues bonds annually to finance budget deficits. By allowing fundraising through token issuance, the government hopes to make it easier for small investors to participate, even with as little as a few hundred baht. G-tokens are designed to offer better and more consistent returns through long-term investments.”
G-tokens represent a significant move by Thailand toward digital innovation in public finance by combining traditional financial security with advanced digital systems.
How to invest in G-tokens: A step-by-step guide
G-tokens mark Thailand’s first tokenized public debt initiative. These digital instruments offer the same benefits as traditional bonds, repayment of principal and scheduled interest, while enhancing accessibility and transparency through blockchain technology.
Here is the process to invest in G-tokens:
- Step 1: Open an account: Investors begin by opening an account with a Thai Securities and Exchange Commission (SEC)-approved digital asset service provider, such as a licensed exchange or digital broker.
- Step 2: Review the prospectus: Once registered, investors must examine the G-token prospectus, which outlines key details such as the issuance size, maturity date, interest rate, transfer rules and payment schedule.
- Step 3: Place a buy order: After reviewing the information, the investor places a buy order through the approved digital platform.
- Step 4: Receive tokens: Upon successful payment, G-tokens are deposited into the investor’s digital wallet linked to the platform.
- Step 5: Hold or trade tokens: The tokens can be held until maturity or traded on licensed digital asset exchanges, providing added liquidity.
- Step 6: Redemption at maturity: At maturity, the Ministry of Finance will electronically transfer the principal and interest to the investor’s registered account, per the terms specified in the prospectus.
Did you know? In 2023, Hong Kong issued its first tokenized green bond worth $100 million using blockchain. It settled the trade in just one day, far faster than the traditional five-day process in legacy systems.
Key benefits of G-tokens
G-tokens mark a new phase in government bond investment in Thailand, blending the dependability of traditional debt instruments with the advancements of blockchain technology. Created to appeal to a broader range of investors, these tokens provide several benefits compared to standard government securities:
- Wider access: G-tokens feature lower entry costs, enabling retail investors, who were previously unable to participate in bond markets, to invest.
- Flexible trading: They are available on regulated digital asset platforms, allowing investors to easily buy or sell them and benefit from improved liquidity.
- Clarity and efficiency: Blockchain technology ensures transparent, secure and unalterable ownership records, fostering trust and simplifying processes.
- Safety: Backed by the Thai government, G-tokens offer a level of security equivalent to that of traditional government bonds.
Who can invest in G-tokens
G-tokens are crafted to make government bond investment more inclusive and accessible through digital means. Whether you are an individual investor, a nonprofit organization or a legal entity seeking to diversify your investment portfolio, G-tokens provide a secure and regulated way to enter Thailand’s debt market.
Below is a detailed overview of who can participate:
- Eligible participants: G-tokens are available to a diverse group of investors, including individual investors, charitable organizations and specific legal entities approved by the Thai SEC. This broad eligibility supports the government’s goal of making public fundraising more accessible and encouraging broader financial participation.
- Requirements: To invest in G-tokens, participants must meet specific basic requirements. Investors must have a basic understanding of digital platforms and use a Thai SEC-approved digital asset service provider. Furthermore, all investors must complete standard Know Your Customer (KYC) procedures to ensure compliance with regulations and transparency in financial dealings.
Did you know? Tokenized bonds reduce the need for intermediaries like clearing houses and custodians by automating settlement and record-keeping through smart contracts, slashing costs and processing time.
Difference between G-tokens and traditional bonds
G-tokens are a digital version of government debt instruments launched in Thailand, utilizing blockchain technology as an alternative to conventional bonds. Both are used to raise funds for the government and provide interest payments to investors, but they differ in structure, accessibility and technology.
The table below highlights how G-tokens and traditional bonds differ:
Taxation of G-tokens in Thailand
From a taxation perspective, the Revenue Department is drafting a tax framework for G-tokens. It will likely resemble the taxation of interest income, creating fair competition with traditional investments.
According to Pinsai Suraswadi, the director-general of the department, the G-tokens will be taxed under the principle of tax neutrality. This means that income earned from G-tokens will be subject to the same tax rate as other similar types of income.
Income from G-tokens is classified as interest income and is subject to the Revenue Department’s 15% withholding tax. Holders can treat this as a final tax or include it in their annual personal income tax filing. G-tokens function like government bonds, which pay interest to holders, so they are taxed at the same rate as interest income, despite being digital tokens rather than traditional bonds issued by the PDMO.
The Revenue Department applies the “substance over form” principle, taxing G-tokens as debt instruments due to their nature, not their token form. If G-tokens were equity instruments, like shares, they would typically be tax-exempt when traded on the market.
Legal and regulatory framework regarding G-tokens in Thailand
G-tokens in Thailand are issued within the country’s established legal and financial framework, ensuring they carry the same credibility as traditional government bonds.
G-tokens will function within Thailand’s legal framework, primarily governed by the Public Debt Management Act of 2005, which authorizes the Ministry of Finance to borrow funds, and the Digital Asset Business Decree of 2018, which oversees the issuance and trading of digital tokens under the supervision of the Thai Securities and Exchange Commission.
These tokens will be regulated by the Thai SEC, which will supervise all aspects of G-token issuance, trading, and investor protection, ensuring adherence to national securities laws and digital asset regulations.
The clear regulatory framework establishes G-tokens as a secure and compliant option for digitally inclined investors seeking to engage in Thailand’s government bond market. G-tokens connect conventional finance with modern digital infrastructure by aligning traditional legal standards with blockchain technology.
The Thai SEC has restricted G-tokens to investment purposes only, prohibiting their use for payments or speculative trading. G-tokens can only be traded on licensed digital asset exchanges in Thailand.
Did you know? Unlike traditional bonds that often require large investments, tokenized bonds can be divided into micro units, allowing everyday retail investors to buy fractions, sometimes for as little as $10.
Risks and considerations of G-tokens in Thailand
While G-tokens provide a modern and accessible means to invest in Thai government bonds, there are certain risks and considerations that you should consider before participating. These elements are crucial for assessing suitability, particularly for first-time or retail investors:
- Limited secondary market liquidity: During the early stages, G-tokens may experience lower trading volumes, which could make it challenging to sell holdings quickly.
- Need for basic digital literacy: Investors must use digital asset platforms, manage digital wallets and understand blockchain-based transactions, which may be challenging for those new to digital finance.
- Potential regulatory changes: The digital asset sector is still developing. Future changes in regulations could impact the issuance, trading or taxation of G-tokens.
- Sensitivity to interest rate fluctuations: Similar to traditional bonds, the value of G-tokens may vary with changes in interest rates, potentially affecting returns if sold before maturity.
Understanding these risks enables investors to make well-informed decisions that align with their financial objectives and risk tolerance.
Broader implications of G-tokens
The launch of G-tokens represents a significant change in how Thailand issues and provides access to government bonds. By converting public debt instruments into digital tokens, this initiative has wide-reaching effects on the investment environment, government financial operations and the nation’s growing digital ecosystem.
This is how G-tokens are likely to impact investors, the state and the ecosystem:
- For investors: G-tokens make government securities more accessible by allowing fractional ownership and online access through licensed digital asset platforms. This approach encourages broader participation among tech-savvy retail investors who want secure, government-backed returns with greater flexibility.
- For the state: The Thai government benefits from a modern, efficient way to raise funds while supporting its national digital finance strategy. Issuing bonds through blockchain technology improves transparency, lowers operational costs and demonstrates the government’s approach to financial innovation and inclusion.
- For the ecosystem: G-tokens strengthen Thailand’s reputation as a leader in digital asset innovation. By combining traditional finance with blockchain infrastructure, the initiative establishes a standard for regulatory clarity, technical performance and public trust. This is expected to promote further fintech growth and attract foreign investment to Thailand’s digital economy.
Are G-tokens the future?
Using digital tokenization to create G-tokens, Thailand is building a model that improves transparency, lowers administrative costs and encourages more people to invest in government debt instruments. The Ministry of Finance seeks to make debt investment more accessible and expand the use of public financial tools, enabling retail investors to participate in government bonds through user-friendly digital platforms.
This initiative will modernize Thailand’s financial system, making government securities more available to a broader audience by allowing fractional ownership and simplifying the investment process. Moreover, blockchain technology enhances the security and efficiency of issuing and trading these instruments.
As Thailand continues to adopt digital innovation in its financial sector, G-tokens demonstrate the power of blending traditional financial tools with advanced technology. This approach benefits investors and the government while strengthening Thailand’s commitment to building a vibrant and inclusive economic ecosystem.