The Securities and Exchange Commission (SEC) of Thailand has approved One Asset Management (ONEAM) as the pioneer firm to introduce a spot Bitcoin exchange-traded fund (ETF) in the nation.
This fund, named ONE Bitcoin ETF Fund of Funds Unhedged and designed for non-retail investors, will be available for investment from May 31 to June 6, with a risk level of eight.
As per Bangkok Post's report, ONE-BTCETFOF-UI is exclusively open to affluent and institutional investors and operates by investing in 11 top global funds to ensure liquidity and safety.
The fund adheres to international storage standards for coins and has received scrutiny from regulatory bodies in the US and Hong Kong.
Pote Harinasuta, CEO of ONEAM, stated that digital assets offer an alternative asset class with minimal correlation to traditional financial assets, thus serving as a means to diversify investment risks.
The approval of this fund aligns with the growing international acceptance of Bitcoin ETFs, as evidenced by the US SEC and Hong Kong’s Securities and Futures Commission allowing the establishment of funds directly investing in spot Bitcoin and Ethereum.
Despite Bitcoin's limited supply of 21 million, its demand is surging with increasing popularity, prompting ONEAM to anticipate substantial growth potential for the cryptocurrency.
Over the past 11 years, Bitcoin has delivered an average annual return of 124%, albeit with a high average annual volatility of 83%.
ONEAM advises investors to allocate only 5% of their portfolio to Bitcoin to achieve a return of 8.90% per year, with a Sharpe ratio of 0.71 and a maximum drawdown of -22.4%. In comparison, a portfolio without Bitcoin yields a return of 5.80% per year, with a Sharpe ratio of 0.48 and a maximum drawdown of -20.4%.
Pote underscores the criticality of coin storage security in Bitcoin ETFs, as direct investment through various platforms poses risks like data loss or theft of digital assets. Investing via ETFs ensures that unitholders' data or coins are managed through custodians, employing the same standards used by institutional investors, which involves offline coin storage for enhanced security.
Meanwhile, MFC Asset Management is still awaiting SEC approval for its Bitcoin ETF, which, similar to ONEAM's, targets wealthy and institutional investors.
June 2024, Cryptoniteuae