Thailand’s Securities and Exchange Commission has moved its planned spot Bitcoin and Ether exchange-traded fund framework into the draft regulation stage. Under the proposals published for public consultation on Aug. 24, locally established crypto ETFs would be required to maintain average net exposure of at least 80% of net asset value to their underlying cryptocurrency over each accounting year, and would trade exclusively on the Stock Exchange of Thailand.
The initial phase would permit passive ETFs tracking only Bitcoin or Ether, with each fund limited to a single cryptocurrency. The regulator said the two assets were selected because they currently have sufficient liquidity and broad market acceptance. Public comments on the ETF rules and a separate proposal covering foreign digital asset custodians will remain open until Sept. 20.
Custody was a central issue in earlier feedback. The revised approach keeps licensed Thai digital asset custodians as the primary option, while giving the SEC discretion to approve qualified foreign custodians “when necessary and appropriate in light of prevailing circumstances.” For mutual funds and private funds, foreign custodians would need to be supervised by a competent authority with adequate investor asset protection standards.
The draft builds on Thailand’s broader expansion of regulated crypto products. In February, the government recognized cryptocurrencies as underlying assets under the Derivatives Trading Act. In June 2024, Thailand approved its first spot Bitcoin ETF fund for institutional and ultra-high-net-worth investors, though that product was not offered to retail investors. The new framework would create crypto ETFs established in Thailand and listed directly on the Stock Exchange of Thailand.
The Securities and Exchange Commission’s consultations opened on Aug. 21 and were publicly announced on Aug. 24. The framework also includes operational readiness requirements for fund managers, including qualified personnel, appropriate systems, and access to capable service providers.
