Report: Taiwan Targets Cryptocurrency Legislation by November

Lawmakers in Taiwan are gearing up to introduce a groundbreaking legislation targeted at the cryptocurrency industry. The move comes in response to increasing concerns about offshore market activities, which Taiwanese officials fear might lead to regulatory discrepancies. Yung-Chang Chiang, a key official in Taiwan’s Legislative Yuan, stated in an interview that he intends to present the initial draft of the law to parliament by the end of November 2023 or even earlier. Chiang emphasized the necessity of such a law to effectively regulate businesses operating in the cryptocurrency space.

The Taiwanese government’s proactive stance on cryptocurrency regulation was evident on October 6 when Chiang organized a public hearing in the parliament. The event brought together digital asset service providers, academics, and industry experts to discuss the draft proposal. This collaborative effort reflects Taiwan’s commitment to drafting comprehensive legislation that caters specifically to the unique challenges posed by the cryptocurrency sector.

Notably, Taiwan’s Financial Supervisory Commission took a significant step on September 26 by releasing comprehensive guidelines aimed at enhancing investor protections in the cryptocurrency market. These guidelines encompass various aspects of the industry, including safeguarding customer assets by segregating them from exchanges’ treasuries. The guidelines also outline mechanisms for reviewing the listing and delisting of digital assets on exchanges, promoting a more transparent and accountable trading environment.

Additionally, the rules specify that foreign virtual asset service providers cannot operate in Taiwan without obtaining the necessary approvals from local regulatory authorities. This measure underscores Taiwan’s commitment to ensuring that the cryptocurrency market operates under a framework of regulatory oversight.

Simultaneously, on the same day as the guidelines were released, major cryptocurrency exchanges operating in Taiwan joined forces to establish an association. This collective initiative aims to advocate for industry interests and foster collaboration among market participants. By forming a unified front, these exchanges are positioning themselves to actively engage with regulators and contribute to the formulation of sensible regulations that balance innovation with investor protection.

Taiwan’s multifaceted approach, involving regulatory guidelines, public consultations, and industry collaboration, underscores the government’s commitment to establishing a clear and effective regulatory framework for the cryptocurrency industry. As the legislative process unfolds, Taiwan appears poised to create a regulatory environment that fosters innovation while mitigating potential risks, positioning the country as a proactive player in the global cryptocurrency landscape.

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