Taiwan is moving towards cryptocurrency regulation with a new law proposal. If this proposal becomes law, all crypto platforms in Taiwan will have to obtain permits to operate. Although the timeline for the second reading is not set, the initial reading of the draft law has passed in Taiwan’s parliament, the Legislative Yuan.
Yung-Chang Chiang, a legislative member involved in proposing this special act, expressed the hope that the Financial Supervisory Commission (FSC) would submit its own draft bill for legislative review. This would allow different parts of society to reach a consensus on cryptocurrency regulations during the process.
Crypto Self-Regulation vs. Legal Enforcement
In the past, the Financial Supervisory Commission (FSC) in Taiwan suggested guidelines for the cryptocurrency industry to form their own rules through a potential industry association. Yet, these guidelines didn’t have the legal power to enforce them.
With the proposed special law, regulatory authorities would gain the ability to impose penalties on those who break these self-regulation rules. Without this special law, regulators wouldn’t have the authority to enforce penalties.
Taiwan’s Proposed Crypto Law and Its Impact
A new crypto law, put forward by Chiang and 16 other lawmakers, would make it mandatory for all cryptocurrency platforms operating in Taiwan to apply for a permit. If they don’t comply, regulators could demand them to stop their operations.
While there’s no fixed schedule for the second reading of this law, it might not happen before January 2024, which is when the current term of all lawmakers in Taiwan ends.
Currently, Taiwan has required providers of virtual asset services to follow anti-money laundering laws since the Financial Supervisory Commission (FSC) introduced these rules in July 2021. Apart from these rules, the cryptocurrency industry in Taiwan remains largely unregulated.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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