Thailand's SET proposes Bitcoin, Ethereum ETF rules, Sept. 20 comment deadline

The Stock Exchange of Thailand proposed rules on Aug. 26 to permit Bitcoin and Ethereum ETF trading exclusively on its platform with Thai-regulated custody, a framework designed to capture billions in digital asset investment flows within domestic markets.

The proposal, open for public comment until Sept. 20, marks the first time SET has outlined a structured path for crypto ETFs, according to the exchange's draft rulebook. All trading must occur on SET, and custody must be held through Thai-regulated entities. The framework applies primarily to Thai-regulated custody, according to the proposal, leaving room for foreign custodians that meet local licensing requirements.

The initial scope covers Bitcoin and Ethereum ETFs, with the exchange planning to expand to other digital assets after the first phase. The rules would make SET the sole venue for crypto ETF trading in Thailand, channeling investor demand through the domestic exchange rather than offshore platforms. This structure differs from markets like the United States, where ETFs trade across multiple venues and custody is held by a mix of domestic and international banks.

The move comes as global crypto ETF demand accelerates. XRP ETFs have drawn $1.57 billion in cumulative flows since their launch, and Bitcoin trades near $78,418 as of Aug. 26. For Thailand, capturing a share of regional crypto investment could lift SET's trading volumes and strengthen Bangkok's position as a Southeast Asian digital asset hub.

Regional competition for crypto capital

Thailand's proposal follows a wave of crypto ETF approvals across Asia. Hong Kong listed its first spot Bitcoin and Ethereum ETFs in 2024, and the United States approved spot Bitcoin ETFs in January of that year. SET's framework differs by mandating domestic custody, a requirement that keeps assets under Thai regulatory oversight and prevents capital flight to foreign exchanges.

The Thai approach also contrasts with Singapore, which has allowed digital asset products through its Payment Services Act but has not yet approved spot crypto ETFs. By creating a dedicated ETF venue with local custody requirements, Thailand is offering institutional-grade products while maintaining regulatory control over the underlying assets.

The comment period closes Sept. 20, after which SET will finalize the rules and publish an implementation timeline. The exchange has not yet disclosed a target launch date for the first Bitcoin or Ethereum ETF products. Market participants will be watching whether the domestic custody requirement attracts or deters global issuers, many of whom already have established custody relationships in Hong Kong and the United States.

If approved, Thailand would join a growing list of jurisdictions that permit spot crypto ETFs. For investors, the key question is whether SET-only trading with Thai-regulated custody will attract sufficient volume to create competitive spreads. The answer will determine whether Thailand captures a meaningful share of the billions flowing into global crypto ETFs — or watches that capital continue to move through Hong Kong and U.S. venues.

This article is for informational purposes only and does not constitute investment advice.