Taiwan to Restrict Offshore Crypto Exchanges Operating Onshore
Taiwan is planning to impose restrictions on offshore crypto exchanges that operate onshore without proper compliance registration. The country’s Financial Supervisory Commission (FSC) has drafted ten guiding principles for virtual asset service providers (VASPs) to establish their own self-regulatory rules. These principles aim to strengthen information disclosure, establish review standards for virtual asset listing and delisting, and ensure the separation and custody of companies’ and customers’ assets. One key restriction is the strict prohibition of illegal business solicitation by foreign crypto firms. The FSC will specify in the guiding principles that foreign VASPs must register according to company law and declare compliance with anti-money laundering regulations to operate within Taiwan or solicit domestic residents.
Binance’s AML Compliance Registration in Taiwan
Taiwan has required VASPs to comply with anti-money laundering laws since July 2021, but the industry remains largely unregulated in the country. Binance, the world’s largest crypto exchange, is currently applying for AML compliance registration in Taiwan. Although Binance is not regulated in the country, it has established a local entity named “Binance International Limited Taiwan Branch (Seychelles).” The government approved Binance’s company registration in Taiwan with a registered capital of NT$30 million ($937,000). In addition, the Ministry of Economic Affairs has proposed adding a new business category to enable cryptocurrency-related companies to establish industry associations. This proposal aims to foster the development of self-regulatory guidelines in the crypto industry.
Hot Take: Taiwan’s Strides in Crypto Regulation and Self-Regulation
Taiwan is taking significant steps to regulate the crypto industry and promote self-regulation among virtual asset service providers. By implementing guiding principles and requiring compliance registration, the government aims to enhance transparency, protect the interests of businesses and customers, and prevent illegal activities. The move to restrict offshore crypto exchanges operating without proper registration demonstrates Taiwan’s commitment to creating a compliant and secure environment for crypto transactions. Binance’s pursuit of AML compliance registration further reflects the industry’s willingness to cooperate and adhere to regulatory requirements. Taiwan’s proposal to establish industry associations also highlights its efforts to foster collaboration and develop self-regulatory guidelines. These initiatives position Taiwan as a proactive player in the global crypto landscape, promoting responsible practices and safeguarding the interests of all stakeholders.
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