Thailand’s securities regulator has issued new rules allowing local asset managers to launch exchange-traded funds tracking bitcoin or ether, establishing a regulated route for investors to gain crypto exposure through the country's stock exchange.
The regulations take effect on October 16. Under the framework, crypto ETFs must trade on the Stock Exchange of Thailand and track a single cryptocurrency, with at least 80% of a fund's net asset value exposed to that specific asset. Bitcoin and ether are the only cryptocurrencies initially eligible for these funds.
Safeguards and Restrictions
The regulatory framework includes several safeguards for market participants:
- Fund holdings must be kept with custodians regulated by Thailand's SEC.
- Investors are required to confirm they understand the associated risks before purchasing the ETFs.
- Brokers are prohibited from lending clients money to buy the cryptocurrency products.
- Retail investors will initially remain barred from products that offer indirect access to foreign crypto ETFs, such as depositary receipts.
Thai asset managers are permitted to outsource crypto investment management to licensed digital-asset fund managers. Additionally, regulated digital-asset custodians and other qualified firms can register to act as fund supervisors for these crypto ETFs.
Broader Market Integration
The SEC has also amended its rules to allow mutual funds and private funds to invest in Thai crypto ETFs, subject to existing investment limits. The initiative integrates bitcoin and ether into Thailand's conventional fund and exchange framework while maintaining specific custody, disclosure, and investor suitability safeguards.
Reports indicate that Thailand has a high rate of crypto users per capita at 20%, placing it above countries such as the United States, Nigeria, the Philippines, and South Africa.
