As a seasoned researcher with a keen interest in the evolving landscape of cryptocurrencies and their regulatory frameworks, I find Taiwan’s latest move towards institutional crypto custody particularly intriguing. Having closely followed the developments in this region, it is clear that Taiwan is taking decisive steps to foster a conducive environment for digital asset adoption.
The Financial Supervisory Commission of Taiwan plans to initiate a trial run for an institutional cryptocurrency safekeeping scheme, starting in early 2025. This regulatory body is currently accepting expressions of interest from potential participants, with three private banks showing initial enthusiasm for the project.
The latest move signifies efforts to promote institutional adoption of crypto in the region.
Institutional Crypto Custody in Taiwan
As per news reports from local sources, participating institutions in this trial should clearly state the sorts of digital assets they plan to safeguard – like Bitcoin, Ethereum, or Dogecoin, for example – and distinguish whether their services are intended for platforms, professional investors (such as institutions), high-net-worth individuals, or the broader public.
During a recent press briefing, the Director of Comprehensive Planning at the FSC, Hu Zehua, noted that although certain security firms have shown interest, it is banks with their substantial financial resources and security concerns in mind, who are more fitting for this role.
Additionally, Zehua noted that prior to accepting applications for trial operations involving virtual asset custody services, the Financial Security Commission intends to conduct a 15-day public consultation period.
In the meantime, the oversight agency plans to share draft regulations and welcome outside feedback for improvement. The input gathered will be utilized to refine the rules before the formal introduction. This procedure is designed so that the three banks showing enthusiasm for the trial can send in their applications after the evaluation phase ends.
Taiwan’s Focus on Crypto
The most recent advancement occurs during a period when the Taiwanese administration is paying more attention to cryptocurrencies. Lately, the Financial Supervisory Commission has proposed a regulation enabling expert investors to invest in foreign crypto-based exchange-traded funds (ETFs) through local brokerages, thereby restricting access to these opportunities for professional investors only.
Last week, the Financial Security Commission (FSC) revised its Anti-Money Laundering (AML) policies to enhance monitoring of local virtual asset service providers (VASPs). Failure to comply will result in strict consequences. Starting January 1, 2025, these new AML guidelines mandate that all cryptocurrency businesses must register with the government by September 2025.
According to CryptoPotato’s report, individuals or entities not complying could be penalized with imprisonment for up to two years or fines amounting to about $155,900 (equivalent to 5 million New Taiwan dollars). This penalty applies even if AML regulations were already implemented as early as July 2021. To avoid penalties, fully compliant companies are required to re-register with the agency.
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2024-10-09 21:14