The crash of many firms last year alarmed both crypto users and regulators. One of the most notable was the FTX exchange crash and its unending contagion, which has spread into 2023. As a result, many regulators in different countries are taking steps to protect crypto users and investors.
Some regulators, such as the US Securities and Exchange Commission, have been pushing hard with various enforcement actions against crypto firms allegedly engaging in practices putting investors at risk. Other countries, such as the UK, recently categorized digital assets in tax forms while three top financial regulators warned banks about digital asset dealings.
However, the latest move in digital asset regulation is from Taiwan, the Republic of China. It has announced a body to monitor the digital asset industry within its shores.
Taiwan Financial Regulator To Oversee Crypto Operations
In a Reuters report on Monday, March 20, Taiwan revealed that the Financial Supervisory Commission (FSC) would take over everything related to digital payments and transactions. This new move is coming based on the growing demand for digital asset regulation.
The Chairman of FSC, Huang Tien-mu, stated that the financial regulator would initially monitor digital payments and transactions. However, its regulatory operations will not include non-fungible tokens (NFTs). The latter is still emerging within the digital asset industry and will be under regulations with time. Also, the confirmation of the official announcement is expected to emerge before the end of March.
Huang disclosed this new crypto regulatory decision while speaking with lawmakers in parliament. The FSC chair mentioned that there would be further discussion of supervisory details and measures with some government units and relevant industry representatives.
The FSC demands that all digital asset firms locally registered must comply with its anti-money laundering (AML) rules. However, the regulator has yet to propose any legislation directly applying to digital assets. Huang mentioned that it’s pretty much early for discussions regarding separate legislation for digital assets.
Crypto Industry Requests Clear Regulations In Taiwan
Hong Kong is striving to become a prominent digital asset hub in the region by setting crypto-friendly regulations to attract several digital asset firms to its land. But Taiwan is yet to disclose its regulatory approach to the digital industry.
The country is known for its strict stance on digital assets as it banned using credit cards for digital asset purchases last year, citing risks associated with digital assets.
Crypto firms and exchanges have, however, requested that the country moves with crypto-friendly regulatory approaches. Bloomberg reported that on Saturday, some companies jointly sent a request paper calling for more friendly digital asset regulation with clarity for operators in the country. Binance Holdings, Woo Netwok LLC, and Matriport Technologies were the authors of the paper.
In the paper, the companies highlighted some difficulties in regulating virtual assets with existing financial rules and categorizations. These include a lack of clarity in legislation and confusion for virtual operators, investors, and even authorities. It recommended that Taiwan reference the EU and Dubai regulatory frameworks that set up independent units from traditional finance for virtual assets.
The FSC’s Banking Bureau oversees traditional lenders and is pioneering Taiwan’s regulatory changes. The bureau has opened talks concerning crypto regulatory changes with digital asset exchange operations. But it has placed exchanges providing virtual asset services as first in its list of regulations.
Featured image from Pixabay and chart from Tradingview.com