Thailand approves crypto-backed derivatives reform

Thailand approves crypto-backed derivatives, integrating digital assets into capital markets. The SEC will oversee new rules to modernize markets and enhance investor protection.

Thailand has enacted major regulatory changes, now permitting digital assets like Bitcoin and Ethereum to serve as underlying assets for regulated derivatives products. This amendment to the Derivatives Act broadens the definition of eligible assets, formally integrating cryptocurrencies into the nation's capital markets framework. The Securities and Exchange Commission (SEC) will supervise the licensing and operation of digital asset derivatives exchanges and brokers. The SEC is also tasked with drafting new rules to update derivatives licenses and set contract specifications, working closely with the Thailand Futures Exchange (TFEX). These reforms aim to modernize Thailand’s derivatives markets, align them with global standards, and enhance investor protection. While the move is seen as overdue, some warn that insufficient safeguards could raise systemic risks. Notably, crypto payments remain banned by the central bank, and stablecoin usage is still restricted.