Thai SEC Gives Go Ahead for Mutual Funds to Gain Crypto Exposure

The Thai SEC is public feedback to revise investment criteria for mutual funds to gain crypto exposure.

Wealthy investors will have greater flexibility, as funds targeting them will have no cap on crypto investments.

The SEC emphasized that fund managers must exercise fiduciary duty in selecting investment channels and managing risks.

On Wednesday, the Thai Securities and Exchange Commission (SEC) introduced new regulations that would allow private funds and mutual funds to invest in crypto assets. This development comes amid the emerging global crypto markets and the rising institutional interest in crypto ETFs worldwide.

The draft proposal from the Thai SEC shows that the regulator is seeking public feedback and the revision of criteria for mutual funds to invest in digital assets. Besides, the regulator is giving asset management firms the go-ahead to offer their clients and big investors to invest in crypto-related products. This includes investing in crypto exchange-traded funds (ETFs) listed on overseas markets such as the US stock exchange.

Speaking to the Bangko Post, Thai SEC deputy secretary-general Anek Yooyuen stated that the investment tokens would be added in the same ratio as other transferable securities such as stocks and bonds since they have similar risks and characteristics.

Furthermore, the funds aimed at wealthy investors will get greater flexibility for investments in digital assets without any upper cap on investments.

“Relevant criteria will be revised to support the establishment and management of funds investing in digital assets, such as asset custody, digital asset value calculation, information disclosure, and appropriate advertising,” Mr Anek.

SEC Revamping Current Rules to Accommodate Crypto Investments

The Thai SEC noted that the current framework and rules for mutual funds have been in place since 2015 and need a major revamp. The new rules will keep up with the digital asset investment changes happening overseas while giving investors exposure to global crypto ETFs. Apart from the Thai regulator, Taiwan is also opening the gates for investments into foreign crypto ETFs.

“The SEC Office sees fit to adjust the criteria for accepting investment in digital assets to be consistent with international development,” reads the translation of the .

The proposed rules would differentiate between high-risk assets such as Bitcoins , stablecoins like USDT , etc. Additionally, the Thai SEC has emphasized that fund managers should exercise “fiduciary duty in selecting appropriate investment channels” while simultaneously managing the associated risks.

The draft proposes limits on digital asset exposure for different fund types. Retail mutual funds would be limited to a 15% allocation in crypto investments, while institutional and ultra-high-net-worth investor funds would have no cap but must diversify to manage risk.

Additionally, the SEC’s proposal sets guidelines for the temporary holding of assets like Bitcoin or Ethereum , limiting the holding period to five business days for trading purposes. “Funds may need to hold crypto assets to buy, sell, or exchange digital assets,” the SEC stated.