Thailand on the road to an institutional crypto market: A new future for digital assets

Thailand on the road to an institutional crypto market: A new future for digital assets

The cryptocurrency market in Thailand is on the cusp of a significant transition from retail trading towards an institutional focus. According to Binance Thailand CEO Nirun Fuwattanukul, the country is looking to establish itself as the fintech hub of Southeast Asia, putting it in the spotlight of investment institutions.

In a recent article for the Bangkok Post, published on 25 October, Fuwattanukul highlighted a key regulatory move taken by Thailand's Securities and Exchange Commission (SEC). In early October, the latter proposed rules allowing institutional funds to invest in cryptocurrencies, including popular US cryptocurrency ETFs. The move is seen as a major step in the development of Thailand's crypto landscape.

"The new regulations will attract more institutional funds, which will not only encourage diverse investment strategies, but also help digital assets pave the way for wider mainstream adoption," Fuwattanukul said. However, according to him, this is not just about legitimising Bitcoin. The goal is to create a more mature ecosystem in which traditional finance and crypto-assets work in synergy with each other.

The move could also pave the way for Thai financial institutions to expand their portfolios and increase their exposure to digital assets, which would support Thailand's ambition to become a regional hub for digital assets.

According to the Thai SEC, the new fund allocations will be directed primarily towards high-net-worth investors, with limited access for retail investors. It is also important to note that Thailand's central bank still prohibits the use of cryptocurrencies for payments, limiting the potential growth of the retail trading segment.

Fuwattanukul further stated that the Thai SEC is considering additional new regulations targeting other crypto activities, with details remaining hidden for now. In addition, the trend of tokenization of real assets (RWAs) is developing in Thailand, with traditional banks evaluating the possibility of converting conventional assets such as bonds and real estate into digital assets that could be traded via blockchain technology.

According to research by Tren Finance, the RWA tokenization sector could see a staggering 50-fold growth by 2030.

Despite the shift to an institutional focus, retail cryptocurrency trading still retains popularity. Thailand's largest crypto exchange, Bitkub, shows a daily trading volume of around $33.5 million, indicating retail investor interest in cryptocurrencies.

Thailand is thus on an exciting path to building a modern and dynamic environment for digital assets, which could fundamentally impact the regional market and make it a major player in the global fintech scene.

The Coingarage team