The Thailand Securities and Exchange Commission (SEC) has introduced a proposal that could expand investment options for mutual and private funds, allowing them to invest in digital assets.

Aligning with Global Trends

The Thai SEC’s proposal reflects growing international interest in cryptocurrencies, particularly with the approval of U.S.-listed Bitcoin and Ethereum ETFs. While Thai investors have had access to these ETFs abroad, domestic mutual funds have been limited in directly investing in digital assets. The SEC aims to modernize regulations to allow more fund managers to incorporate crypto-related products into their portfolios.

New Opportunities for Fund Managers

Under the new rules, securities companies and asset management firms would be allowed to offer services to institutional and high-net-worth investors interested in crypto-related products like ETFs. These firms could help investors navigate the complexities of digital assets while managing associated risks. For retail mutual funds, the SEC proposes a 15% cap on digital asset exposure to protect retail investors from high-risk volatility.

Differentiating Between High-Risk and Stable Assets

The SEC's draft proposal introduces guidelines to differentiate between types of digital assets. High-risk assets like Bitcoin would be treated differently from stablecoins like Tether, designed to maintain steady value. To manage market risks, the SEC proposes limits on temporary holding of assets like Bitcoin or Ethereum, allowing them to be held for only a maximum of five business days for trading purposes.

Updates in the SEC's investment rules could significantly impact Thailand's cryptocurrency market development, creating new opportunities for both investors and fund managers.