Thai SEC Releases Draft Regulations for Cryptocurrency ETFs

The Thai Securities and Exchange Commission (SEC) has announced draft regulations for cryptocurrency exchange-traded funds (ETFs), which will be open to public comment until September 20. Initially, the regulations will apply only to Bitcoin (BTC) and Ethereum (ETH). The SEC is also revising the requirements for digital asset custodians used by investment trusts and private funds.

The draft regulations require cryptocurrency ETFs to be established and operated by an asset management company (AMC), which must adhere to additional investor protection measures. The operating method will be a passive type, linked to the price of a single cryptocurrency. Each year, the average net exposure to target assets must be at least 80% of total net assets.

The SEC will designate the target cryptocurrencies based on factors such as liquidity and market acceptance. In the initial phase, only Bitcoin (BTC) and Ethereum (ETH) will be considered. The listing and trading of cryptocurrency ETFs will be limited to the Thai Stock Exchange (SET). AMC's will need to provide detailed information about their products, related businesses, and risks.

The SEC is also revising rules for investment trusts and private funds to allow them to invest in both foreign and domestic cryptocurrency ETFs. However, during the initial phase, no alternative products such as depositary receipts (DR) will be allowed to track overseas cryptocurrency ETFs.