The Taiwanese financial regulator announced today that new laws will take effect in January 2025, requiring crypto exchanges to implement stricter procedures when listing or delisting cryptocurrencies.
Crypto Listing And Delisting To Face Greater Scrutiny
In a statement issued today, Taiwan’s Financial Supervisory Commission (FSC) specified that from January 2025, crypto trading platforms in Taiwan must conduct more thorough due diligence on digital assets before listing or delisting them.
These new requirements are part of the FSC’s “registration regulation,” which will also reinforce anti-money laundering (AML) compliance for crypto exchanges.
Hsi-Ho Huang, director of the FSC’s securities firms division, announced at a conference today that “virtual asset service providers” (VASPs) must register and comply with these updated regulations.
Notably, non-compliance with the new regulations can lead to criminal penalties for the offender. This could include imprisonment for up to two years.
It should be recalled that currently, VASPs are required to comply with AML rules that were introduced back in July 2021. Subsequently, the FSC was given the responsibility to regulate the digital assets industry in Taiwan in March 2023.
The new rules are expected to heighten oversight in key areas such as fiat custody, information security, complaint management, user data protection, and information sharing.
In addition, the listing and delisting of digital assets will be monitored closely, with exchanges required to establish measures against illicit trading and report unusual price movements and trading volumes.
Additionally, the FSC mandated that digital asset custodians must hold user assets in trust or keep them separate from the platform’s proprietary assets. Crypto trading platforms must also appoint a CPA to release annual reports on client assets.
Taiwan’s Proactive Approach To Crypto Regulation
Taiwan’s regulatory approach to digital assets has been proactive compared to other countries. Unlike neighboring China, Taiwan has adopted a positive but cautious attitude toward crypto assets.
In October 2024, the FSC permitted professional investors to invest in foreign exchange-traded funds (ETFs) through a re-entrustment process, provided they meet certain criteria.
In parallel, a recent report revealed that the FSC, in partnership with local financial banks, is considering piloting institutional crypto custody services next year.
Besides the FSC, Taiwan’s Ministry of Justice has proposed a stricter legal framework this year, aiming to impose severe penalties on those involved in money laundering and other crypto-related malpractices.
Interestingly, it appears that China is closely monitoring Taiwan’s approach to digital assets. Recently, a former senior official from China’s Ministry of Finance urged the current Chinese administration to re-evaluate its strict stance on the emerging asset class.
At press time, Bitcoin (BTC) trades at $68,940, up a modest 0.8% in the past 24 hours. According to data from CoinGecko, the total crypto market cap stands at $2.40 trillion.
