Thailand’s bitcoin mutual funds are riding high, with returns skyrocketing up to 30% since their debut in June. This impressive surge aligns with bitcoin’s upward trajectory, edging closer to the US$100,000 mark, a climb bolstered by policies linked to Donald Trump’s recent win in the US presidential election.
In a move that has energised the market, the Securities and Exchange Commission (SEC) in Thailand has greenlit just two asset management giants, One Asset Management (ONEAM) and MFC Asset Management (MFC), to offer mutual funds investing in bitcoin exchange-traded funds (ETFs).
These exclusive offerings cater only to institutional and ultra-accredited investors, those with the keen acumen and risk appetite necessary to navigate the volatile world of cryptocurrencies and digital assets.
Bitcoin, the king of cryptocurrencies, has been enjoying a rally, gaining 0.9% to hit US$95,964 yesterday, December 1. Analysts remain bullish, anticipating bitcoin will smash through the US$100,000 barrier later this year.
One Asset Management launched the ONE Bitcoin ETF Fund of Funds Unhedged, marked under the ticker ONE-BTCETFOF-UI, on June 6.
Tailored for institutional investors, this fund spreads its investments across top-tier master funds: Franklin Bitcoin ETF takes up 50.6% of the portfolio, iShares Bitcoin Trust accounts for 38.4%, and Fidelity Wise Origin Bitcoin Fund holds 10.5%. By November 26, the fund’s assets had swelled to an impressive 327 million baht.
Pote Harinasuta, ONEAM Chief Executive, proudly declared, “ONE-BTCETFOF-UI has mirrored the master funds’ performance, achieving returns exceeding 30%.”
He attributes this uptick to Trump’s pro-bitcoin pivot, noting how regulated mutual funds offer compelling benefits like tax exemptions and secure, SEC-regulated custody, presenting a far safer option compared to non-regulated alternatives.
Joining the crypto surge is MFC Asset Management with its MFC Bitcoin ETF Tracker Fund, known as MBTCETF-UI. This fund chiefly invests in Bitcoin ETFs via iShares Bitcoin Trust, managed by BlackRock, the world’s leading ETF provider.
Chaovakorn Chotibunt, Executive Vice President and head of the investment strategy at MFC revealed that “MBTCETF-UI has delivered a return of about 30% since its launch on June 7.”
As of November 23, iShares Bitcoin Trust boasted a 99% return, while bitcoin itself saw an astounding 134% gain. Chaovakorn attributes this surge to optimistic speculation about bitcoin’s integration into the financial fabric, spurred by Trump’s favourable stance.
Capitalising on this rising interest, MFC raised the MBTCETF-UI’s asset size from 2 billion baht to 5 billion on November 14. By November 27, the fund’s net asset value climbed to 2.5 billion baht.
Chaovakorn issued a word of caution.
“Bitcoin and digital assets present very high risks. We typically recommend investing only 1% of your portfolio, or aligning with your risk tolerance.”
Chaovakorn noted that Bitcoin increasingly appeals to younger investors and those wary of the shaky US dollar.
As bitcoin fever continues to grip the financial world, Thailand’s crypto-savvy funds stand poised to benefit from this modern-day gold rush.
Frequently Asked Questions
Here are some common questions asked about this news.
Why are Bitcoin mutual funds gaining traction among institutional investors in Thailand?
Their appeal lies in tax benefits, secure custody, and regulation, enhancing safety compared to non-regulated options.
How might Trump’s policies influence Bitcoin’s future role in the global financial system?
Speculation suggests his pro-Bitcoin stance could drive widespread adoption and integration into mainstream finance.
What if Bitcoin surpasses the US$100,000 milestone?
It could spur increased institutional investment, potentially stabilizing its value and solidifying its status as a financial asset.
How do younger investors’ views on digital assets impact their investment strategies?
Their enthusiasm for high-risk, high-reward investments like Bitcoin indicates a shift towards more dynamic portfolio diversification.
What factors contribute to the perceived high risk of Bitcoin investments?
Volatility, regulatory uncertainties, and market speculation all contribute to Bitcoin’s high-risk profile.
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