Bitcoin Funds in Local Market See Impressive 30% Returns
Local Bitcoin funds have been on fire lately, boasting impressive returns of 30% after being launched earlier this year. Definitely catching the eyes of investors as Bitcoin prices near $100,000 following the latest US presidential election results.
Only two asset management firms, One Asset Management (ONEAM) and MFC Asset Management (MFC), got the green light from Thailand’s Securities and Exchange Commission (SEC) to kick off mutual funds centered around spot Bitcoin exchange-traded funds (ETFs).
The SEC has limited investment in these funds to institutional investors and ultra-accredited investors due to the high risks tied to cryptocurrencies and digital assets. It’s no walk in the park – these investors must have a deep understanding and be ready to handle significant risks.
The biggest cryptocurrency out there climbed 0.9% to $95,964 last Friday, with many experts predicting it’ll hit $100,000 before the year’s end.
For instance, ONEAM launched the ONE Bitcoin ETF Fund of Funds Unhedged (not for regular investors) – aka ONE-BTCETFOF-UI – on June 6. This fund is diversified across various master funds, such as Franklin Bitcoin ETF (50.6%), iShares Bitcoin Trust Fund (38.4%), and Fidelity Wise Origin Bitcoin Fund (10.5%). The total assets are sitting at 327 million baht as of November 26.
Pote Harinasuta, the head honcho at ONEAM, mentioned that the ONE-BTCETFOF-UI saw returns of over 30%, following the master funds’ performances closely. “Investor interest is at an all-time high thanks to Bitcoin reaching new peaks, boosted by Trump’s favorable views on Bitcoin,” he said.
Experimenting with digital assets through regulated mutual funds comes with perks like no withholding tax and SEC-regulated management firms handling asset custody. Mr. Pote emphasized that these funds are a safer, more secure choice than unregulated platforms.
On the other hand, MFC rolled out the MFC Bitcoin ETF Tracker Fund (also not for the everyday investor) – or MBTCETF-UI – investing in Bitcoin ETFs, especially through iShares Bitcoin Trust managed by BlackRock, the top ETF provider globally.
Chaovakorn Chotibunt, MFC’s executive vice-president focused on investment strategy, pointed out that MBTCETF-UI returned about 30% since its inception on June 7. As of November 23, the iShares Bitcoin Trust raked in a 99% return, while Bitcoin itself scored a whopping 134% gain.
Mr. Chotibunt linked the price rally to market speculation linked to Trump’s policies, stirring optimism about Bitcoin’s potential in the financial system. Due to the growing demand, MFC pumped up MBTCETF-UI’s registered asset size from 2 billion baht to 5 billion on November 14. By November 27, the fund’s net asset value hit 2.5 billion baht.
“Bitcoin and digital assets are super risky alternative investments,” he warned. “We recommend dabbling only 1% of your investment portfolio in this space, or any sum that fits your risk tolerance.”
Younger folks are showing a lot more interest in digital assets, while some investors are shifting to Bitcoin amid concerns about the US dollar’s stability, according to Mr. Chotibunt.
