Thailand Drafts Rules for Bitcoin and Ether ETFs

The regulator’s framework limits the initial phase of the program to Bitcoin and Ether, citing the need for assets that demonstrate high liquidity and broad market acceptance. Under the proposed rules, these ETFs will trade exclusively on the Stock Exchange of Thailand, allowing investors to gain exposure to digital assets through traditional securities accounts rather than managing individual crypto wallets.

Asset management companies seeking to launch these products must prove sufficient operational readiness, including the deployment of qualified personnel and robust security systems. While the SEC continues to emphasize the use of onshore digital asset custodians, the draft provides a mechanism for the regulator to approve qualified foreign custodians on a case-by-case basis. This reflects an attempt to balance the growth of domestic infrastructure with the necessity of international expertise.

Public feedback on the draft rules and revised qualification standards for foreign custodians is being accepted until Sept. 20. This move marks a significant step in the regulator's broader strategy, which has already seen the introduction of crypto-linked derivatives and the approval of specialized funds for ultra-high-net-worth investors. By integrating these products into the existing regulatory framework, Thailand aims to reduce the operational risks associated with direct crypto ownership and streamline institutional access to the market.