Thailand SEC’s Proposal Could Expand Crypto Investments for High-Net-Worth Investors

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Thailand’s Securities and Exchange Commission (SEC) is considering allowing mutual and private funds to invest in crypto-related products. This move aims to meet the increasing demand from institutional investors and high-net-worth individuals.

Opening Doors for High-Net-Worth Investors

The proposal, revealed on October 9, outlines steps for expanding the scope of investment options, including crypto exchange-traded funds (ETFs) traded in the United States.

The new proposal by the SEC would allow mutual and private funds to venture into digital assets like crypto, which is already gaining traction among institutional investors.

This would particularly benefit high-net-worth investors, who would get more access to these crypto funds than retail investors.

In this proposed framework, mutual funds accessible to regular investors would have limits on crypto exposure, capped at 15%.

However, institutional and high-net-worth investors would have no such restrictions, giving them greater freedom to diversify their portfolios with crypto assets.

According to Anek Yooyuen, deputy secretary-general of the Thai SEC, “Investment tokens will be included with the same investment ratios as transferable securities such as stocks and bonds because they have similar characteristics and risks.”

Revised Rules for Crypto Fund Management

In addition to opening up more investment opportunities, the Thailand’s SEC plans to introduce stricter rules for managing funds that invest in digital assets. These include updated guidelines on how assets are held and their value is calculated, as well as transparency requirements, such as disclosing detailed information to investors.

The regulator is also revisiting its rules on advertising for funds that deal with crypto products.

One major part of the proposal is the focus on different types of digital assets. High-risk assets like Bitcoin will be treated separately from more stable digital currencies, such as stablecoins.

This reflects a growing concern about the volatility of certain cryptocurrencies and the need for caution in integrating them into mainstream investment vehicles even though there have been calls for increased investment in crypto.

The regulator also plans to allow initial coin offering (ICO) portals to outsource fundraising tasks to third-party companies, making the token-raising process smoother for businesses.

Despite these positive changes, the regulator is maintaining a cautious approach by proposing higher penalties for market manipulation. The new rules would impose stricter fines for “naked short-selling” and inappropriate trading orders.

Thailand is gradually becoming more crypto-friendly, although the central bank still bans retail crypto payments. The Thai SEC is working to change this, and it plans to discuss the use of crypto for payments with the Bank of Thailand.

Meanwhile, the Thai SEC is preparing a Digital Asset Regulatory Sandbox, a project involving ten private firms conducting trial projects for exchanging crypto assets for the local currency. The regulator’s efforts come as crypto trading continues to rise in Thailand.

About Jimmy Aki PRO INVESTOR

Based in the UK, Jimmy is an economic researcher with outstanding hands-on and heads-on experience in Macroeconomic finance analysis, forecasting and planning. He has honed his skills having worked cross-continental as a finance analyst, which gives him inter-cultural experience. He currently has a strong passion for regulation and macroeconomic trends as it allows him peek under the global bonnet to see how the world works.