Taiwan’s Financial Supervisory Commission (FSC) is set to implement new anti-money laundering (AML) regulations for cryptocurrency service providers starting November 30. The upcoming rules require crypto exchanges and other virtual asset service providers (VASPs) to register for AML compliance. The initial deadline for mandatory AML registration for crypto companies was January 1, 2025, but the FSC has moved the date forward by a month.
In a statement released on November 28, the regulator emphasized that overseas entities offering virtual asset services in Taiwan must establish a local presence and complete the AML registration process under the Company Law. Currently, 26 crypto providers are approved to operate in the country; however, all of them – registered or not – must adhere to the updated AML requirements.
To aid with compliance, the FSC has issued a checklist to assist platforms in identifying suspicious activities. The checklist instructs these platforms to monitor customer details such as names, bank account information, IP locations, and account usage patterns. Furthermore, they must also look out for unusual transaction activities like frequent changes to account information, splitting funds across multiple accounts using different IP addresses.
Failure to comply with these regulations could result in severe penalties including fines of up to NT$5 million ($153,700) and imprisonment for up to two years. This regulatory push follows the FSC’s recent decision to penalize two local exchanges – MaiCoin and BitoPro – each fined NT$1.5 million ($45900) for multiple violations related to non-compliance with AML regulations.
According to the agency, both exchanges failed in areas such as improving customer due diligence and maintaining adequate transaction records while also failing to identify suspicious transaction patterns effectively. In an effort towards creating a balanced approach towards cryptocurrency regulation within its borders; Taiwan has been actively advancing its regulatory framework as part of its strategy toward positioning itself as a global leader in digital assets space since last year when it introduced ten guiding principles designed specifically aimed at enhancing transparency through improved information disclosure alongside establishing clear standards surrounding listings delistings custody funds held by clients versus those belonging directly owned by firms operating under said jurisdictions purview respectively speaking furthermore more recently revealed plans introduce registration system requiring cryptocurrency exchanges register Taiwanese government basis September next year While having tightened oversight encourages growth sector last month granted professional investors access exchange traded funds linked foreign digital assets alongside regulator preparing pilot program institutional cryptocurrency custody applications set open early next year three private banks already expressed interest participating initiative
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