Following an announcement made by the Financial Supervisory Commission of Taiwan (FSC), it will now serve as the principal regulating body for cryptocurrencies in Taiwan.
A number of legislators have advocated for the Ministry of Digital Affairs (MODA) to take the lead role in regulating cryptocurrencies.
Notwithstanding this, the FSC made it public by releasing a statement that was delivered by its chairman, Huang Tien-mu, while he was speaking to the Taiwanese parliament.
The Financial Supervisory Commission (FSC) and the Central Bank of the Republic of China (CBRC) are Taiwan’s two financial watchdogs.
While the Central Bank is in charge of regulating monetary policy as well as the foreign exchange market, the Financial Services Commission (FSC) is in charge of monitoring payments and transactions in the cryptocurrency market and preventing the laundering of illicit funds.
The co-founder and current CEO of Taiwanese fintech company XREX, Wayne Huang, believes that the proposal for regulations is a positive step in the right direction.
Huang is of the opinion (1) that the business can only advance with increased regulation.
The Financial Supervisory Commission Starts Working
In his address to the parliament, Chair Huang of the Financial Supervisory Commission mentioned that the commission was currently working on a regulatory framework for cryptocurrencies.
By the end of June, the Taiwanese legislature anticipates having a first framework. When it is finished, the framework will demand the separation of client assets and corporate cash and provide protection for a greater number of investors.
On the other hand, Huang emphasized that some assets, such as non-fungible tokens (NFTs), might not be subject to the authority of the FSC. Instead, it would be governed by the Ministry of Digital Affairs, which would be responsible for monitoring it.
Wayne Huang highlighted the fact that non-fungible tokens might represent everything from industrial applications to commodities and securities. As a result, Huang pointed out that there is a requirement to correctly categorize the NFTs before attempting to regulate them.
The Crash of the FTX Inspires Unconventional Regulation
It has been hypothesized that the failure of the FTX bitcoin exchange may have contributed to an increased resolve to control the cryptocurrency business.
Over 950 Taiwanese citizens had approximately $150 million worth of assets caught up in the collapse of FTX. Because of this, the Taiwanese community became one of the largest consumers of FTX on a population basis.
Again, the growing reports come at a time when the Chinese government is attempting to regard Taiwan as a separatist province and take it back under its authority.
It is well knowledge that China is opposed to cryptocurrencies, and in 2021, the country will implement a ban on the trading of cryptocurrencies within its borders.
Taiwan is taking more proactive steps to regulate the cryptocurrency business, in contrast to China, which has outright banned cryptocurrencies.
Within its anti-money trafficking compliance framework, it gave its stamp of approval to the registration of twenty-four cryptocurrency platforms in September of last year.