March 27, 2024
Bitcoin ETF

Thailand’s SEC Opens Doors for Institutional Investors to Bitcoin ETFs

The Securities and Exchange Commission of Thailand, SEC, has revised its rules, allowing the launch of private funds investing in spot Bitcoin exchange-traded funds (ETFs). The Bangkok Post reported that the amendment will restrict participation to institutional and “ultra-high net worth individuals” with the amendment coming into force from March 12.

Regulatory Shift Post US Approval of Bitcoin ETF

Historically, regulations overseeing asset management firms did not encompass digital asset ETFs. However, with the US securities regulator approving spot Bitcoin ETFs in January, Thai regulations redefined shares in these ETFs as securities rather than crypto assets. SEC Secretary-General Pornanong Budsaratragoon emphasized the high-risk nature of Bitcoin exchange-traded products (ETPs) and announced that only accredited investors would gain access.

Pornanong Budsaratragoon, secretary-general of Thai SEC. Source: The Nation

Retail Investors Left on the Sidelines

Despite the regulatory shift, retail investors are excluded from the opportunity to invest in spot Bitcoin ETFs. Thailand’s SEC, cautious about the high risks associated with digital assets, refrains from granting asset management firms the ability to invest directly in Bitcoin and spot Bitcoin ETFs.

Retail crypto trading, although popular in Thailand, faces limitations due to governmental restrictions. The ban on using digital assets for payments since March 2022 and the SEC’s prohibition on cryptocurrency use for lending and investment in July 2023 have curtailed retail involvement. However, the regulator eased restrictions in January, permitting retail investors to purchase digital tokens backed by real estate or infrastructure projects.

The Kingdom’s leading crypto exchange, Bitkub, boasts 107 pairs with a daily volume of approximately $155 million, according to CoinGecko. Despite this, the accessibility of Binance’s new exchange in the Thai market, introduced in January, is confined to Thai nationals, further delineating the boundaries for retail investors in the burgeoning crypto landscape.

Image by Mr.Than Pitak from Pixabay

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