Thailand has taken its first steps into the world of Bitcoin with the launch of a novel exchange-traded fund (ETF) focusing on high-net-worth people and establishments. Towards this backdrop, world curiosity in cryptocurrencies has surged, however Thai regulators are taking a cautious strategy, prioritizing safety and managed entry for newcomers.
Entry restricted to the privileged few
Thailand-based Bangkok Submit disclosed on Tuesday that the U.S. Securities and Change Fee (SEC) has permitted the unhedged funds within the ONE Bitcoin ETF launched by One Asset Administration (ONEAM). In contrast to conventional ETFs which can be accessible to most of the people, this ETF has a excessive barrier to entry.
Solely accredited traders, together with establishments and rich people, can take part. This restrictive entry displays a standard theme in Asia that regulators are taking a cautious strategy to Bitcoin. Regardless of China’s crackdown, different international locations similar to South Korea and Japan have applied stricter know-your-customer (KYC) laws and itemizing necessities for cryptocurrency exchanges.
Safety first: Bitcoin wrapped in a security internet
ONEAM ETF modifications the everyday investing paradigm. Moderately than immediately holding prime cryptocurrencies, the fund invests in a basket of 11 established world Bitcoin funds. This “fund of funds” construction is designed to mitigate dangers related to particular person buying and selling platforms, which have confronted points similar to knowledge breaches and theft of digital property up to now.
BTCUSD buying and selling at $68,940 on the 24-hour chart: TradingView.com
As well as, ETFs emphasize protected storage practices, utilizing worldwide requirements and custodians utilized by institutional traders. These custodians retailer Bitcoin offline, tremendously decreasing vulnerability to on-line assaults.
Diversification
For accredited traders, Bitcoin’s attraction lies in its potential for portfolio diversification. The token’s value actions are likely to have low correlation with conventional property like shares and bonds. Which means a small allocation to Bitcoin helps scale back total portfolio volatility.
Regardless of the potential advantages, the SEC additionally acknowledges that there are inherent dangers related to investing in cryptocurrencies. Bitcoin’s historical past has been characterised by excessive volatility and vital value swings. To handle this threat, ONEAM recommends a cautious strategy, recommending that traders allocate solely 5% of their portfolios to Bitcoin.
Thailand takes a step ahead
Thailand’s transfer into Bitcoin ETFs is a fastidiously deliberate transfer by regulators. It acknowledged rising curiosity in cryptocurrencies however prioritized defending much less refined traders. Restricted entry rights and a concentrate on safe storage mirror this cautious strategy.
That is in stark distinction to another Asian markets similar to Hong Kong, which not too long ago permitted ETFs for direct funding in Bitcoin and Ethereum, doubtlessly opening the door to a wider vary of traders.
Featured pictures from Pastel, charts from TradingView
