Thailand’s Cabinet has approved changes to its Derivatives Act to permit digital assets like cryptocurrency to serve as underlying instruments for regulated derivatives products. The Securities and Exchange Commission (SEC) will now draft rules to update licenses and work with the Thailand Futures Exchange (TFEX) on contract specifications. Local observers say the reform aligns regulation with market reality but warn that weak safeguards could raise systemic risk.
Thailand’s Cabinet has approved key changes to expand the types of assets allowed under the country’s Derivatives Act. Under the new regime, crypto would be permitted to serve as underlying instruments for regulated derivatives products.
“This development will help promote more inclusive market growth, facilitate diversification and more effective risk management, and expand investment opportunities for a broader range of investors,” SEC Secretary-General Pornanong Budsaratragoon stated in a statement. The regulator will draft rules to amend derivatives licenses so digital asset operators can offer crypto-linked contracts and coordinate with TFEX on specifications.
Local observers said the reform is overdue and largely reflects an effort to bring digital asset activity into a clearer legal framework. Pichapen Prateepavanich, policy strategist and founder of infrastructure firm Gather Beyond, noted that digital assets already function as financial instruments in practice.
“If properly structured, they allow for hedging, better liquidity, and the kind of institutional participation we need. Otherwise, our markets remain thin and reactive as now,” she said in conversation. Still, expanding the scope “without simultaneously strengthening disclosure standards and capital requirements would increase systemic risk,” she warned.
The principle to maintain is that innovation should sit firmly within the rule of law and investor protection, she added. Thailand’s crypto regime began taking shape in 2018 with an Emergency Decree on Digital Asset Businesses.
