Thailand approves first Bitcoin ETF

ONEAM is expected to be distributed from May 31 to June 6, with an investment risk level of 8.

The fund has a policy of investing in 11 leading global funds to ensure liquidity and safety, storing coins according to international standards and is being reviewed by international regulatory agencies in the US and Hong Kong.

Meanwhile, MFC Asset Management continues to wait for SEC approval to acquire a Bitcoin ETF, so it cannot yet reach wealthy institutional investors.

'Digital assets are alternative assets with low correlation to other financial assets,' said Pote Harinasuta, operator of ONEAM. They are suitable to help investors diversify investment risks.

Thus, Bitcoin ETFs are gaining international recognition, especially from regulators in many countries after the US SEC approved funds to invest directly in spot Bitcoin through ETFs earlier this year. .

In April, the Hong Kong SEC also authorized the establishment of ETFs investing in both Bitcoin and Ethereum.

Bitcoin's total market capitalization is currently $1.35 trillion, compared to $4 trillion in gold market capitalization.

Pote commented: 'While Bitcoin supply is limited to 21 million, demand is growing due to growing popularity. We see Bitcoin's high growth potential.

Over the past 11 years, Bitcoin's average returns have been as high as 124% per year, while average annual volatility has also increased at 83%.

'Investing in Bitcoin can yield good returns but comes with high volatility'.

ONEAM recommends investors allocate only 5% of their portfolio to Bitcoin to achieve a return of 8.9% per year.

This portfolio's return to risk (Sharpe ratio) is 0.71, with a maximum downside of -22.4%.

The no-Bitcoin portfolio generated a return of 5.8% per year, with a Sharpe ratio of 0.48 and a maximum drawdown of -20.4%.

According to Pote, this shows that holding Bitcoin improves expected returns and Sharpe ratios, despite a slight increase in overall volatility.

He said an important feature of the Bitcoin ETF is the security of coin storage.

'Investing directly in Bitcoin through various platforms carries risks, with prominent problems in the past such as data loss or digital assets being stolen through online systems.'

When investing through an ETF, the holder's data or coins will be distributed by the custody organization (custody). This organization offers the same standard used by institutional investors, meaning highly secure, offline coin storage.

Samuel Daniel

Update 05 June 2024