Thailand Finalizes Rules for Bitcoin and Ether ETFs

The new framework mandates that each crypto ETF operate as a passive investment fund, requiring a minimum 80% annual average exposure to a single underlying cryptocurrency. During this initial phase, the regulator has restricted eligible assets exclusively to Bitcoin and Ether. Fund managers must meet stringent standards regarding custody, operational systems, and investor protection, and all assets must be held by licensed Thai digital asset custodians.

While the regulations open a path for domestic investment, the SEC has maintained strict barriers against foreign products. Securities firms are prohibited from facilitating investments in overseas crypto ETFs for retail customers, and margin loans for local crypto ETFs remain banned. Brokers must also ensure that investors undergo a risk disclosure process before trading, while asset managers are required to provide transparency regarding custody arrangements and investment structures.

Industry leaders have responded with cautious optimism. Attakrit Chimphlapibul of Bitkub Group noted that while the framework creates new opportunities for local financial businesses, the market's success hinges on the readiness of operators and actual investor demand. Nares Laopannarai, president of the Thai Digital Asset Association, highlighted that traditional stock market participants have historically shown limited interest in digital assets, suggesting that the industry may face challenges in driving widespread adoption. Despite the October 16 effective date, the SEC has yet to approve specific ETF issuers or confirm a launch date for the first products.