The Thai Securities and Exchange Commission (SEC) has proposed new rules to improve the handling of cryptocurrency in mutual and private funds. This is part of Thailand’s larger effort to regulate the growing digital asset market and ensure investors’ protection.
The proposed rules will focus on several important areas. One of these is setting limits on how much cryptocurrency can be included in these funds, which will help manage the risks for investors.
Another focus is on transparency, as the rules will require funds to disclose their cryptocurrency holdings and their investment strategies. Additionally, the securities regulator wants to establish standards for digital assets custody, to reduce the risk of theft or loss.
Thailand is making big efforts to include cryptocurrency in its financial system through specific actions and projects.
For example, the Thai government and the Securities and Exchange Commission (SEC) have introduced rules for cryptocurrency exchanges like Bitkub, one of the largest exchanges in the country. These rules help ensure that exchanges operate legally and safely, protecting users from fraud.
In 2018, Thailand became one of the first countries to regulate Initial Coin Offerings (ICOs), a fundraising method where companies offer their digital tokens.
The Thai SEC established guidelines for businesses using ICOs, protecting investors from scams and ensuring companies meet specific standards.
The new rules will guide investment funds, such as mutual funds and private equity funds, that invest in cryptocurrencies, defining the amount of money that can be allocated to digital assets like Bitcoin or Ethereum, ensuring that funds don’t take on excessive risk.
Additionally, these funds must transparently report their cryptocurrency holdings and investment strategies.
Beyond that, Thailand is also using blockchain technology in other areas. For instance, the country’s Siam Commercial Bank partnered with Ripple, a blockchain-based payment company, to offer faster and cheaper cross-border payments.
Four months ago, the Thailand government approved One Asset Management (ONEAM) to launch the “ONE Bitcoin ETF Fund”, the first spot Bitcoin exchange-traded fund (ETF) in the country.