- The Thai financial market has achieved a new milestone as the Securities and Exchange Commission (SEC) approved One Asset Management (ONEAM) to launch the nation’s inaugural Bitcoin exchange-traded fund (ETF).
- This ETF, named ONE Bitcoin ETF Fund of Funds Unhedged and not for Retail Investors (ONE-BTCETFOF-UI), will be available for investment between May 31 and June 6, targeting high-net-worth and institutional investors.
- Pote Harinasuta, ONEAM’s chief executive, has highlighted Bitcoin’s low correlation with other financial assets and its significant potential for portfolio diversification.
Thailand’s first Bitcoin ETF offers new investment opportunities, backed by stringent international storage standards and regulatory approvals.
A Pioneering Move by Thailand SEC: Approval of ONEAM’s Bitcoin ETF
In a historic decision, the Thai Securities and Exchange Commission (SEC) has granted One Asset Management (ONEAM) permission to launch the country’s first Bitcoin exchange-traded fund (ETF). Named ONE Bitcoin ETF Fund of Funds Unhedged and not for Retail Investors (ONE-BTCETFOF-UI), this product will be distributed between May 31 and June 6. Designed for affluent and institutional investors, this ETF exhibits a high investment risk level of eight.
Focus on Security and Global Standards
According to the Bangkok Post, the fund aims to invest in 11 leading global funds, ensuring both liquidity and safety. ONEAM underscores the significance of storing Bitcoin using internationally recognized standards. This initiative has undergone rigorous evaluations by regulatory bodies in the United States and Hong Kong, bolstering its credibility and security.
Bitcoin as an Alternative and Diversifying Asset Class
Pote Harinasuta, the CEO of ONEAM, advocates for the inclusion of digital assets like Bitcoin in investment portfolios due to their low correlation with traditional financial assets. This characteristic makes Bitcoin an effective tool for risk diversification. The approval of this ETF is a testament to the growing acceptance of digital asset funds worldwide. Earlier this year, the US SEC sanctioned funds that invest directly in spot Bitcoin through ETFs, followed by the approval from Hong Kong’s Securities and Futures Commission for ETFs investing in both Bitcoin and Ethereum in April.
The Growing Demand and Volatility of Bitcoin
Despite Bitcoin’s finite supply of 21 million coins, its popularity continues to surge. Harinasuta emphasizes Bitcoin’s substantial growth potential, noting its impressive average annual return of 124% over the past 11 years. However, he also cautions about its high volatility, which averages 83% annually. This dual nature of Bitcoin presents both significant opportunities and risks for investors.
Security Measures for Bitcoin Storage
One of the paramount advantages of Bitcoin ETFs is the enhanced security of coin storage. Investing directly in Bitcoin on various platforms can be fraught with risks, including potential data breaches or theft of digital assets. Harinasuta argues that Bitcoin ETFs offer a safer alternative by distributing unitholder data and coins through reputable custodians who adhere to stringent standards used by institutional investors. This process includes offline storage of coins, considered much more secure against cyber threats.
Global Comparisons: Australia’s Market Moves
CoinDesk reported that Australia-based Monochrome Asset Management recently launched its Monochrome spot Bitcoin ETF (IBTC) on the Cboe Australia exchange. Prior to this, Australian investors were limited to ETFs that held Bitcoin indirectly or through offshore products, which offered less investor protection. This development in Australia highlights a global trend towards offering more secure and regulated Bitcoin investment products.
Conclusion
The introduction of ONEAM’s Bitcoin ETF represents a significant advancement for the Thai financial market, providing a new avenue for high-net-worth and institutional investors to access Bitcoin. With robust international storage standards and regulatory scrutiny, this ETF not only offers diversification benefits but also enhances security for investors. The global trend, as seen in both the US and Australia, suggests a growing maturity and acceptance of Bitcoin ETFs, potentially paving the way for further innovations in digital asset investments.
