Thailand’s Securities and Exchange Commission (SEC) has moved its framework for locally listed spot Bitcoin and Ether exchange-traded funds (ETFs) from proposed principles to draft regulations, while revising its approach to foreign digital asset custodians.
The regulator on Monday opened a public consultation on two papers: one outlining draft rules for Thai crypto ETFs and another proposing principles for qualifying foreign digital asset custodians used by mutual and private funds investing in digital assets. Initially, asset managers would be permitted to launch passive ETFs tracking only Bitcoin (BTC) or Ether (ETH).
The draft regulations follow an April consultation on broader framework principles, during which most respondents supported the initiative but provided feedback on custody arrangements. The SEC adjusted its proposals in response. The framework aligns with Thailand’s goal of positioning itself as a global digital asset hub for institutional investors.
Under the proposed rules, Bitcoin and Ether ETFs would trade exclusively on the Stock Exchange of Thailand (SET). Each ETF would track a single crypto asset and maintain an average net exposure of at least 80% of its net asset value to that asset over each accounting year. Mutual funds and private funds would be allowed to invest in Thai-domiciled crypto ETFs, as well as foreign crypto ETFs within existing investment limits.
The SEC’s revised custody proposal would require crypto ETFs to primarily use onshore digital asset custodians during the initial phase. Qualified foreign custodians may be permitted if deemed necessary by the regulator, provided they are supervised by a competent authority and meet Thai SEC standards for regulatory oversight and investor asset protection.
Public comments on both consultation papers will be accepted until September 20.
