In an exciting development, the nine exchange businesses have made their announcement through a press release that was published just yesterday. This exciting move is a response to the highly anticipated release of comprehensive guidelines on cryptocurrency trading and payments by Taiwan’s Financial Supervisory Commission (FSC) before September comes to a close.
Developing regulatory environment
The industry body forming in Taiwan is set to include participation from well-known exchanges like MaiCoin, BitoGroup, and ACE. While Taiwan has been a bit slow on the regulatory front when it comes to cryptocurrencies, they have already taken steps to ensure that virtual asset services providers (VASPs) adhere to the country’s anti-money laundering (AML) regulations. However, there are still many unique intricacies in the cryptocurrency industry that need careful consideration and regulation.
Authorities in Taiwan have presented ten guiding principles for VASPs, all aimed at protecting Taiwanese consumers. And here’s the best part: the forthcoming guidelines will address these concerns by introducing a comprehensive set of rules inspired by the successful VASP licensing framework in Hong Kong. The main focus? Consumer protection, of course! The proposed guidelines suggest specific hot and cold wallet ratios for customer deposits with cryptocurrency exchanges, a brilliant measure to safeguard customer funds. On top of that, they even propose mandatory insurance against user losses to boost consumer confidence.
The FSC’s guidelines also aim to prevent offshore cryptocurrency exchanges from operating onshore in Taiwan without proper compliance registration. This step ensures that everyone participating in Taiwan’s cryptocurrency market follows the same standards. To top it all off, the guidelines propose a ban on stablecoins linked to the Taiwanese dollar and restrictions on foreign exchange advertising within the country. This move is all about stabilizing the Taiwanese financial system and putting an end to deceptive advertising practices.
Exciting times are ahead for Taiwan’s cryptocurrency industry as they gear up to establish a regulatory framework that prioritizes consumer protection and sets the stage for a thriving and secure market.
Enabling self-regulation
Regulators are thinking outside the box and proposing a whole new business category for crypto regulations. And that’s not all – they are even looking to promote self-regulation. It’s a positive step forward, showing their commitment to creating a favorable environment for the industry.
In line with this initiative, nine cryptocurrency firms have come together to form an industry association. Led by the esteemed Winston Hsiao, Co-Founder of XREX, this group has established a working group with a clear mission: to speed up the development of self-regulatory rules based on the upcoming FSC guidelines. They are wasting no time in taking proactive action.
Wayne Huang, another visionary Co-Founder of XREX, is filled with hope. He believes that the new FSC guidelines will bring legitimacy, oversight, a clear growth path, and most importantly, the trust of the public to the cryptocurrency industry. It’s all about setting the industry on the right track.
The formation of this industry association, combined with the impending release of the FSC’s comprehensive regulatory guidelines, is a major milestone for Taiwan’s cryptocurrency sector. These proactive measures are crucial for ensuring the industry’s stability, security, and compliance with international standards as it continues to evolve.