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Speaking to the parliament, Chairman Huang pointed out that the Financial Supervisory Commission was working on a crypto regulatory framework.
The Financial Supervisory Commission of Taiwan (FSC) has announced that it will now be the primary regulatory body for cryptocurrencies in Taiwan. Some lawmakers had called for the Ministry of Digital Affairs (MODA) as the chief crypto regulator. However, FSC made it known in a statement by its chairman, Huang Tien-mu while addressing the Taiwan parliament.
Taiwan has two financial regulators: the FSC and the Central Bank of the Republic of China. While the Central Bank regulates monetary policy and foreign exchange regulations, the FSC is responsible for supervising payments and transactions in the crypto market and preventing anti-money laundering.
According to Wayne Huang, co-founder, and CEO of Taiwanese fintech XREX, the proposal for regulation is a welcome development. Huang believes the industry can only grow with regulation.
First Moves by the Financial Supervisory Commission
Speaking to the parliament, Chairman Huang pointed out that the Financial Supervisory Commission was working on a crypto regulatory framework. The Taiwanese parliament expects an initial framework by June. Once completed, the framework will protect more investors and mandate the separation of customer assets from company funds.
However, Huang stressed that other assets like the nonfungible tokens (NFTs), may not fall under FSC’s jurisdiction. Instead, it would fall under the supervision of the Ministry of Digital Affairs.
Wayne Huang pointed out that NFTs range from commercial products to commodities and securities. Consequently, Huang noted that there is a need to properly classify the NFTs before regulating them.
Contrarian Regulation Inspired by FTX Collapse
There are suggestions that the collapse of FTX may have increased the determination to regulate the cryptocurrency industry. About $150 million belonging to 950 Taiwanese citizens was caught up when FTX collapsed. This meant that the Taiwanese community formed one of the largest users of FTX per capita.
Again, the emerging reports come when the Chinese government is looking to treat Taiwan as a breakaway province and place it back under its control. China is well known for its anti-crypto stance, with the country banning cryptocurrency trading in the country in 2021.
While China has outrightly banned crypto, Taiwan is taking more active steps to regulate the industry. Last September, it approved the registration of 24 crypto platforms under its anti-money laundering compliance system.