Thailand’s Securities and Exchange Commission has advanced regulations for locally listed spot Bitcoin and Ethereum exchange-traded funds, opening a new public consultation as the country moves closer to allowing retail investors to gain direct crypto exposure through its traditional stock market. The Thai SEC opened two consultations on August 24 covering draft regulations for domestic crypto ETFs and revised requirements for foreign digital-asset custodians used by mutual and private funds.
Public comments are open until September 20, after which the regulator can revise and finalize the framework. Under the proposed rules, the initial generation of Thai spot crypto ETFs would be limited to Bitcoin and Ether. Each fund would track a single cryptocurrency and maintain average net exposure of at least 80% of its net asset value to that underlying asset during its fiscal year. The products would be structured as mutual funds, operate as passive investment vehicles and trade exclusively on the Stock Exchange of Thailand.
Bitcoin and Ether Are Initially the Only Eligible Assets
Thailand is deliberately beginning with the two largest cryptocurrencies rather than immediately opening ETFs to a broader range of digital assets. The SEC’s eligibility framework requires an underlying cryptocurrency to have a mature spot market, regulated derivatives markets, reliable price indexes and the ability to be securely held by qualified digital-asset custodians in Thailand. Bitcoin and Ether currently satisfy those requirements. The proposed ETFs would be classified as alternative investment funds with a special risk designation of 8+, reflecting the regulator’s assessment of cryptocurrency volatility and other risks.
The structure also differs from funds obtaining synthetic crypto exposure through derivatives. Thailand’s proposal calls for direct investment in the underlying cryptocurrency and prohibits the ETFs from creating their crypto exposure through futures contracts. Mutual funds and private funds would additionally be permitted to invest in locally established crypto ETFs, alongside foreign crypto ETFs already allowed under existing regulations and subject to applicable investment limits. The SEC does not initially plan to permit alternative securities, such as depositary receipts, whose value simply tracks foreign crypto ETFs. Thailand had previously provided institutional investors with limited access to overseas spot Bitcoin ETF products. The new framework would establish locally domiciled and locally traded vehicles accessible through Thailand’s domestic capital-market infrastructure.
Custody Rules Aim to Keep Crypto Assets Under Regulatory Oversight
Custody is another central component of the proposed framework. The SEC plans to prioritize digital assets being held by custodians regulated within Thailand. Crypto ETFs would generally be required to use locally licensed digital-asset custodians, creating a regulated separation between fund management and control of the underlying tokens. The regulator is simultaneously revising rules governing when foreign digital-asset custodians can be used. The broader objective is to give investors exposure to cryptocurrency prices without requiring them to manage private keys, cryptocurrency wallets or direct exchange accounts themselves.
Thailand’s latest consultation follows an earlier round launched this year. Legal analysis of the SEC’s proposals said the regulator initially expected supporting crypto ETF rules to take effect during the third quarter of 2026. The country has also adopted other measures intended to encourage regulated digital-asset activity. Thailand currently provides a personal income-tax exemption on qualifying cryptocurrency capital gains from January 1, 2025, through December 31, 2029. The ETF framework would provide another regulated channel for that market while bringing asset managers, custodians and the Stock Exchange of Thailand directly into the investment process.
Thailand would join a growing group of jurisdictions that have incorporated spot cryptocurrency ETFs into conventional securities markets following launches in the United States, Hong Kong, Canada and Australia. The August 24 proposals do not yet mean Thai Bitcoin and Ether ETFs can immediately begin trading. The consultation must conclude and final regulations still need to be adopted before asset managers can launch products under the framework. But moving from general principles to detailed draft regulations represents a significant step toward implementation. If finalized substantially as proposed, Thai investors would eventually be able to buy locally regulated Bitcoin and Ether exposure through ordinary brokerage infrastructure while professional fund managers and regulated custodians handle acquisition and storage of the underlying cryptocurrency.
