Taiwan's Regulatory Body Sets Ground Rules for Cryptocurrency Platforms
Taiwan's FSC releases guidelines for virtual asset providers, promoting safety and self-regulation in the crypto sector.
Thu, 28 Sep 2023, 08:45 am UTC
Taiwan's top financial regulatory agency, the Financial Supervisory Commission (FSC), has recently laid down a fresh set of rules intended to enhance safety measures for cryptocurrency enthusiasts and investors.
On September 26, the FSC released comprehensive guidelines directed at virtual asset service providers (VASP) operating within its borders. These guidelines touch upon several salient points including the importance of keeping an exchange's operational funds separate from those of its customers. Additionally, there are clear directions on how virtual assets should be introduced and removed from the listing.
To tighten its grip on offshore operators, the FSC has declared that foreign VASPs should not operate in Taiwan unless they have procured the necessary permissions from the agency. Explaining this stance, the FSC conveyed that any international virtual asset platform that hopes to do business in Taiwan needs to be appropriately registered as per Taiwanese law.
Further, the FSC encourages VASPs to take the initiative and adopt self-regulation, anticipating that these VASP groups will establish their own set of standards based on the official guidelines.
This directive from the FSC coincided with the announcement of the creation of the Taiwan VASP Association on September 26. This consortium consists of native exchanges like Maicoin, Rybit, Xrex, Hoya Bit, BitstreetX, Bitgin, and Shangbito, and aims to foster the growth of the industry and assist in its regulation.
Binance, a globally recognized cryptocurrency trading platform, serves clients in Taiwan and has even sought to register under Taiwan's Money Laundering Control Act and with the FSC. Kraken, another prominent name in the field, claims to offer comprehensive services to Taiwanese residents. Similarly, ByBit has facilities for Visa and Mastercard transactions in regions such as Taiwan, as indicated on its site.
The FSC's move comes after reports on September 7 that highlighted the agency's draft of ten foundational principles to oversee virtual currencies. This development was preceded by the FSC's appointment as the chief regulatory figure for cryptocurrencies in Taiwan in 2023.
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