Thailand is set to become a major player in the Bitcoin space as the Thai Securities and Exchange Commission (SEC) is considering approving Bitcoin exchange-traded funds (ETFs) for the first time.
This will give individual and institutional investors access to local Bitcoin ETFs, a big step for Thailand to become a digital asset hub in the Asia-Pacific region.
Currently Thai investors can only get indirect exposure to bitcoin through a fund-of-funds launched by One Asset Management in 2024.
This fund invests in overseas Bitcoin ETFs but is not allowed to directly invest in bitcoin itself. By approving local Bitcoin ETFs, Thai SEC wants to close this gap and give more options to the growing number of Bitcoin enthusiasts in the country.
“Like it or not, we have to move along with more adoption of cryptocurrencies worldwide,” said Pornanong Budsaratragoon , Thai SEC Secretary-General. “We have to adapt and ensure that our investors have more options in crypto assets with proper protection.”
As of November 2024, Thailand had 270,000 active digital-asset trading accounts, up from 117,000 the previous month. This is despite global challenges such as market volatility and past digital-asset sector bankruptcies.
Thailand’s move to approve Bitcoin ETFs comes as Singapore and Hong Kong are already moving ahead with their own digital assets frameworks.
Both have approved spot digital asset ETFs and are positioning themselves as the leaders in the region. Japan and South Korea are taking a more cautious approach though, and are restricting ETF approvals.
By approving local Bitcoin ETFs Thailand wants to stand out in the crowded regional market. This is in line with its strategy to attract international players like Binance which has already set up shop in the country through Gulf Binance, a joint venture.
Former Prime Minister and digital assets advocate, Thaksin Shinawatra, has also proposed issuing stablecoins backed by government bonds. Thaksin believes these initiatives will strengthen Thailand’s financial market and make digital currencies more accessible to retail and institutional investors.
The Thai government is also getting into the tourism sector with Bitcoin.
A pilot program in Phuket will allow tourists to pay with bitcoin and other digital assets. Deputy Prime Minister Pichai Chunhavajira said this will make it easier for tourists to transact digitally and boost Thailand’s competitiveness in the global tourism market.
This will operate within existing laws, so no regulatory changes are needed. If successful, it will open up Bitcoin to other tourist destinations in the country.
Despite all this, Thailand’s digital asset market still has challenges.
Earlier this year, authorities shut down an unauthorized bitcoin mining farm in Chonburi, citing the need for stricter enforcement of regulations. Trading in Thailand has not yet recovered to pre pandemic levels, partly due to the 2022 market crash.
Thailand is getting ahead of the curve with new Bitcoin regulations and innovation. By approving Bitcoin ETFs and getting digital assets into tourism, the country is positioning itself as a digital asset hub.
