Thailand’s SEC Eases Investment Restrictions in Select Digital Assets

The Securities and Exchange Commission (SEC) of Thailand has updated the criteria for investing in digital tokens, easing some restrictions.

In a meeting held on March 2, 2023, the SEC Committee approved the principles for improving investment criteria and related criteria for digital asset business operations, aiming to establish effective investor protection mechanisms while considering the risks associated with digital assets.

Following the completion of the draft announcement in September 2023, which received positive feedback from the majority of commentators, the SEC opened the floor for public comments, according to an official announcement. 

Based on the input received, the SEC enhanced the rules governing investments in digital tokens and related services.

For one, the commission has lifted investment restrictions previously imposed on retail investors for digital tokens backed by real estate or generating real estate income streams (real estate-backed ICOs) and digital tokens with infrastructure operations or revenue streams (infra-backed ICOs).

Previously, retail investors were limited to investing a maximum of 300,000 baht per offering.

Thailand’s SEC Removes More Crypto-Related Restrictions

The SEC also reviewed the criteria for establishing custodial wallet provider businesses, enabling them to offer services to digital asset business operators.

However, it said that these businesses must have major shareholders who may be listed companies or subsidiary companies, possessing the necessary expertise and experience in safeguarding clients’ securities or other financial assets.

Compliance with SEC-specified independence criteria is also required.

Furthermore, digital asset business operators seeking to engage in additional business activities must obtain permission from the SEC.

Finally, digital asset business operators are prohibited from providing services through illegal digital asset operators.

The SEC’s announcement, including the specified criteria, has been published in the Royal Gazette and will take effect from January 16, 2024, onward.

Thai’s SEC Denies Spot Bitcoin ETFs

The SEC of Thailand has made it clear that it will not allow the trading of spot Bitcoin exchange-traded funds (ETFs) in the country.

The decision comes as the Thai SEC believes that foreign-approved Bitcoin ETFs are still in their early stages and may not align with the economic needs of the local market.

“We are monitoring these developments, but currently, there is no plan to permit the establishment of spot Bitcoin ETFs in Thailand,” a representative told the Bangkok Post.

While the Thai SEC has taken this position, securities brokerages in Thailand are encouraging investors to consider investing in Bitcoin ETFs based in the United States.

However, the Thai SEC has warned that investment advice provided to clients must be appropriate and in line with the available products in Thailand.

Bitcoin ETFs provide a convenient pathway for both retail and institutional investors to gain exposure to Bitcoin through traditional brokerage accounts, eliminating the need for crypto wallets and exchanges.

The approval of Bitcoin ETFs in the United States marks a significant shift in attitude after years of reluctance due to various risks associated with cryptocurrencies.

The decision puts the US in line with other countries like Canada, Australia, and Switzerland, which have already introduced Bitcoin ETFs. It’s worth noting that the US has had Bitcoin futures-based ETFs available since 2021.

In addition to Thailand, the financial market regulator in South Korea has also confirmed that it will not allow the trading of Bitcoin ETFs on the domestic market.