Taiwan's Legislative Yuan, the island's single-house parliament, has taken an important step toward cryptocurrency regulation.
On October 25th, legislators presented the Virtual Asset Management Bill, designed to enhance consumer protection and provide effective oversight of the burgeoning industry.
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The bill is a 30-page document that outlines various responsibilities for Virtual Asset Service Providers (VASPs). These include the segregation of customer and company funds, the establishment of comprehensive internal control and audit systems, and mandatory membership in a local trade association.
Interestingly, the bill refrains from demanding that stablecoin issuers maintain a 1:1 ratio with reserve funds and leave the specifics of advertising guidelines to the "competent authority."
Fines for VASPs operating without proper licensing range from a minimum of 2 million Taiwanese dollars (approximately $60,000) to a maximum of 20 million TWD (around $600,000).
For those already in business, a six-month grace period is allotted to comply with licensing requirements once the legislation is enacted.
This comes on the heels of recent guidelines set forth by Taiwan's Financial Supervisory Commission (FSC) in September 2023. The FSC explicitly bans foreign VASPs from offering their services in Taiwan unless they have received approval from the regulatory body.
Adding to this regulatory development is the formation of the Taiwan Virtual Asset Platform and Transaction Business Association by major local cryptocurrency exchanges such as MaiCoin, BitstreetX, Hoya Bit, Bitgin, Rybit, Xrex, and Shangbito. Established on September 26th, this self-regulatory body aims to collaborate with regulators and bolster the crypto industry in Taiwan.
In other Taiwan-related news, Circle is launching a Points-to-Crypto service in collaboration with Taiwan's FamilyMart and BitoGroup, allowing FamiPoints to be converted to USDC.
