Taiwan’s cryptocurrency sector has officially established an industry association under the government’s guidance, a significant step toward regulating the nascent sector. The formation of the Taiwan Virtual Asset Service Provider Association marks a crucial move by Taiwan to enhance its oversight of crypto trading platforms.
The Association’s Formation
- A total of 24 crypto firms, registered with the Financial Supervisory Commission (FSC) for anti-money laundering (AML) compliance, have joined the association.
- Titan Cheng, the founder and CEO of BitoPro, one of Taiwan’s major exchanges, will chair the association.
- Winston Hsiao, the co-founder and chief revenue officer of XREX, will serve as the vice chair.
The Association’s Mandate
- The government has mandated the association to formulate self-supervisory rules.
- The association’s primary task will be to develop self-regulatory guidelines, aiming to implement proper classification and grading management of virtual asset service providers (VASPs).
- This will “cater to the interests and development of the industry while also meeting government expectations and protecting consumer rights,” the association stated.
Taiwan’s Crypto Regulation Landscape
- Currently, Taiwan requires cryptocurrency service providers to comply with AML laws since the FSC introduced these rules in July 2021.
- However, the crypto industry remains largely unregulated beyond AML compliance.
- Last month, the Ministry of Justice proposed amendments to the existing AML laws that would require domestic and overseas crypto firms seeking to operate in Taiwan to register for AML compliance. Failure to do so could result in imprisonment for up to two years.
The establishment of the crypto industry association is a significant step in Taiwan’s journey toward self-regulation and enhanced oversight of the cryptocurrency sector. As the association formulates its self-regulatory guidelines, it will play a crucial role in shaping the future of the country’s crypto ecosystem.
