- Thailand’s SEC opened consultations on draft rules for local spot Bitcoin and Ether ETFs.
- The regulator also proposed standards for foreign digital asset custodians serving certain funds.
Thailand crypto ETFs moved a step forward after the country’s Securities and Exchange Commission shifted its framework from proposed principles to draft regulations. The regulator said it is seeking feedback on two consultation papers, one covering draft rules for locally listed spot Bitcoin and Ether exchange-traded funds and another outlining qualification principles for foreign digital asset custodians used by mutual and private funds investing in digital assets. During the initial stage, only passive funds tracking Bitcoin or Ether would be allowed. The move follows an April consultation, when respondents broadly backed the framework but raised points about custody arrangements.
Thailand crypto ETFs enter draft rule stage
Thailand’s SEC said Monday that it had advanced its work on local spot Bitcoin and Ether ETFs from the principle stage to draft regulations. At the same time, it revised its approach to foreign digital asset custodians after earlier feedback on how custody should work under the framework. The regulator is now collecting comments on two separate papers. One focuses on the draft regulations for Thai crypto ETFs, while the other sets out proposed principles for foreign custodians involved with mutual and private funds that invest in digital assets. Public comments on both papers will be accepted until Sept. 20.
Trading rules for Thailand crypto ETFs
Under the proposed rules, Bitcoin and Ether ETFs would trade only on the Stock Exchange of Thailand. Each fund would track a single crypto asset rather than a basket, and each ETF would be required to keep average net exposure of at least 80% of its net asset value to that asset over each accounting year. In the initial phase, asset managers would be able to launch passive ETFs tied only to Bitcoin or Ether. These are the only two crypto assets listed as eligible at this stage, which limits the first round of products to funds following one of those two assets.
Custody approach and foreign providers
The SEC said the April consultation showed broad support for the overall framework, but respondents provided comments on custody arrangements. That feedback led the regulator to revise its earlier approach while keeping onshore digital asset custodians as the main providers for crypto ETFs during the initial phase.
According to the SEC, crypto ETFs would still be primarily required to use onshore digital asset custodians, though the regulator may permit qualified foreign digital asset custodians when it considers that necessary and appropriate under prevailing circumstances. This revised model appears alongside the separate consultation on foreign custodian qualifications.
Under that separate proposal, foreign custodians serving mutual and private funds investing in digital assets would need supervision from a regulatory authority with legal powers. They would also need to operate under regulatory and investor asset protection standards that the Thai SEC considers adequate.
Fund access and market scope
The proposed rules would allow mutual funds and private funds to invest in Thai-domiciled crypto ETFs. Those funds are already allowed to invest in foreign crypto ETFs, subject to existing investment limits, and the new proposal would add locally listed crypto ETFs to that available set. However, the SEC said alternative products linked to foreign crypto ETFs would not be permitted during the initial phase. That means products such as depositary receipts tracking foreign crypto ETFs would remain outside the scope at this stage. The framework is part of Thailand’s stated ambition to become a global digital asset hub for institutions.
Conclusion
Thailand crypto ETFs are now closer to launch after the SEC moved from broad principles to draft regulations and opened consultations on both fund rules and foreign custodian standards. The proposal would allow locally listed spot Bitcoin and Ether ETFs to trade on the Stock Exchange of Thailand, with passive structures only and a minimum 80% average net exposure to a single asset over each accounting year. The regulator also kept onshore custodians as the primary option in the initial phase while allowing room for qualified foreign providers when appropriate. Public feedback on the two consultation papers will remain open until Sept. 20.
Disclaimer
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