The approval from Thailand’s Securities and Exchange Commission has greenlit One Asset Management to introduce the inaugural spot Bitcoin exchange-traded fund (ETF) in the country, tailored specifically for affluent and institutional investors.
One Asset Management has received the SEC’s nod to launch a spot Bitcoin ETF, designed to cater to wealthy and institutional investors in Thailand. Bitcoin ETFs are gaining global credibility, promising potentially high returns alongside considerable volatility.
The investment in Bitcoin through ETFs offers secure coin storage solutions and aids in enhancing expected returns and Sharpe ratio, notwithstanding a slightly elevated volatility factor. The fund will be diversified across 11 global funds, adhering to international standards for coin safekeeping. Similarly, MFC Asset Management is awaiting approval for a comparable Bitcoin ETF. The CEO of ONEAM has underscored Bitcoin’s potential as an alternative asset class with low correlation to conventional financial assets.
Internationally, Bitcoin ETFs are garnering recognition, with leading regulators acknowledging their merit. Following the approval by the US SEC earlier this year, Hong Kong’s Securities and Futures Commission authorized the creation of ETFs investing in both Bitcoin and Ethereum.
The write-up accentuates the pronounced growth potential and volatility of Bitcoin, suggesting a 5% portfolio allocation to Bitcoin for enhanced returns, recognizing the security advantages of investing in Bitcoin through ETFs:
- Diversification: ETFs enable indirect exposure to Bitcoin without the necessity of holding the cryptocurrency directly.
- Liquidity: Bitcoin ETFs trade on reputable stock exchanges, thereby facilitating ease of transactions.
- Regulated and Secure: ETFs are regulated financial instruments, offering enhanced security compared to unregulated crypto exchanges.
- Accessibility: ETFs broaden investment opportunities to a wider investor base, including novices in the cryptocurrency realm.
- Lower Costs: ETFs typically levy lower fees than actively managed funds, enhancing cost efficiency.
- Tax Efficiency: ETFs may impart tax advantages by deferring capital gains taxes until shares are sold.
While Bitcoin ETFs present an avenue for asset exposure, they also pose risks. These include market volatility, regulatory uncertainty, counterparty risks, tracking errors, liquidity risks, fees and expenses, and tax implications. It is advisable to evaluate your risk tolerance and undertake comprehensive due diligence before engaging in any financial investment.
