Taiwan legislators are hoping to propose a draft crypto regulation law by the end of November, according to lawmaker Yung-Chang Chiang. The goal is to prevent regulatory arbitrage as worries mount over offshore crypto exchanges.
Chiang told the media that a dedicated crypto asset act is required to properly regulate cryptocurrency companies, which diverge greatly from traditional finance. He held a public hearing to discuss a draft proposal with industry players and experts.
While Taiwan’s financial regulator recently released crypto guidelines, Chiang said they lack enforceability without a specific law. The proposed act would require crypto platforms to obtain permits or face penalties for non-compliance.
Currently, only anti-money laundering rules apply to Taiwan’s crypto sector. Many firms operate without fully registering with regulators. Chiang believes it’s unlikely the law passes this year, but sees potential for enactment in mid-2024.
At the hearing, Binance’s Damien Ho said crypto firms still struggle to get banking services in Taiwan despite regulators asking banks to be more open to the industry. Ho suggested the government encourage banks to become more “crypto-friendly.”
The push for dedicated crypto regulations comes as concerns persist around offshore exchanges like FTX. Taiwan lawmakers aim to have a draft law ready by November before refining it next year for eventual passage.
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