Taiwan's crypto industry regulation is about to be released! Legislator Guo Guowen held a public hearing on the 7th, with Binance representatives attending. Five major conclusions were finally drawn, including the establishment of special laws and differentiated supervision. Guo Guowen suggested setting up a "Financial Technology Bureau" to let professionals take charge.
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Crypto Regulatory Public Hearing is here!
Binance representatives show up
Taiwan's crypto industry regulation is about to be released! After becoming the competent authority, the Financial Supervisory Commission stated that it will refer to foreign trends and gradually regulate, and at the same time require domestic companies to "self-discipline" to cooperate with development. Huang Tianmu, chairman of the Financial Supervisory Commission, also said that the first wave of specific regulations is expected to be released as early as September.
Legislator Kuo Kuo-wen held a public hearing on September 7, inviting people from all walks of life, including administrative units, major exchanges, experts and scholars, lawyers and representatives of relevant associations, to provide relevant suggestions on what should be included in the "Guidelines for Managing Virtual Asset Platforms and Trading Businesses."
It is worth noting that Binance and Bitfinex, overseas exchanges that have not yet landed in Taiwan, both have representatives participating.
According to the draft guiding principles provided by the Financial Supervisory Commission, overseas exchanges must be established in Taiwan, otherwise they will have to close their doors and cannot operate in Taiwan. Therefore, exchange operators with a certain market share in Taiwan are bound to pay attention to the next regulatory developments.
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Formulate special laws and differentiated supervision!
Five conclusions to understand at once
The public hearing ultimately came to five major conclusions, mentioning that there should be "differentiated measures" for operators of different sizes; in response to the diversity of virtual assets, it is also suggested to "formulate special laws" for supervision. These suggestions will be asked to the Financial Supervisory Commission to go back and formulate relevant measures:
Virtual asset regulation should focus on broad regulation rather than deep regulation.
The current supervision regulations have a very high legal threshold. Differentiated supervision measures should be proposed for small-scale or relatively simple businesses.
Formulate regulations for over-the-counter transactions and include them in the regulatory scope
In response to the continuous innovation of financial technology, the Financial Supervisory Commission should actively strive to establish a Financial Technology Bureau to handle financial technology and virtual asset business.
In response to the cross-domain and diverse nature of virtual assets, special laws should be formulated to regulate them.
Legislator Kuo Kuo-wen invited people from all walks of life to hold a public hearing on September 7, and ultimately put forward five major conclusions for the Financial Supervisory Commission to study.
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Let the professionals come!
Guo Guowen: A "Financial Technology Bureau" should be established
Taiwan's current supervision of virtual currencies only includes "money laundering prevention measures" and "compliance statement mechanisms." Guo Guowen said that with the upcoming guidelines and the subsequent establishment of a virtual asset industry association, and proposed by the industry Through self-discipline and other means, gradual management will make the system more and more mature.
No matter how perfect the regulatory measures are, the regulatory capacity must be taken into consideration, especially since there are currently no full-time staff. The review of compliance statements alone is too much for the Securities and Futures Bureau to handle, and this is a problem that the competent authority must face.
Therefore, he emphasized that the Financial Supervisory Commission should set up a "Financial Technology Bureau" with full-time personnel to supervise virtual asset business and innovative financial technology.
Stop going underground! Small currency traders should adopt "tiered regulation"
In addition, Guo Guowen also believes that the supervision of the Financial Supervisory Commission should aim to bring the entire market under control and must pursue broad supervision. However, the current legal threshold is very high, which results in individual currency traders or small-scale operators being unable to comply with regulations and deciding to go underground, which becomes a major loophole in crime prevention.
In the future, tiered regulation should be adopted. The business content of small-scale currency traders is not as complicated as that of exchanges. Through differentiated supervision, the willingness of small currency traders to be regulated and brought to the surface can be increased to reduce underground transactions.
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Binance Representative:
Willing to share supervision experience from various countries
International industry representative He Xuanrong, representative of Binance's global partnership team, affirmed the guidelines, believing that the coverage is complete and it is a good initial supervision. He emphasized that Binance is willing to share the supervision and practical operation experience of various countries, as well as Binance's internal regulations, to make Taiwan's virtual asset regulatory system more perfect.
He Xuanrong, a representative of Binance's global partnership team, said that Binance is willing to share the supervision and practical operation experience of various countries, as well as Binance's internal regulations.
Chen Minghui, chief operating officer of Maicoin, a representative of local exchange operators, also agrees with the tiered management model for supervision, which differentiates based on business size, type, and commodity risk classification. For example, exchanges that simply engage in buying and selling, or simple businesses such as wallet custody, may not need to apply costly and strict money laundering prevention measures.
Tsai Yu-ling, chairman of the Taiwan Fintech Association, believes that the governments of Singapore, Japan, Hong Kong and other countries have clearly stated their support for industry development. Just when everyone is striving to become a gathering place for the virtual asset industry, Taiwan lacks clear industrial policies.
Therefore, Tsai Yu-ling hopes to help communicate with the Accounting Research and Development Foundation to set accounting audit standards for cryptocurrencies so that accountants can have audit benchmarks, otherwise it will be difficult to comply with the guidelines. At the same time, if the audit mechanism of banks, accountants or third-party units is improved, the overall industry development will be sound and the exclusion of traditional financial industries can be reduced.
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Sneak peek at the 10 key points of the draft!
If overseas exchanges are not established, it is illegal
According to the draft guidelines provided by the Financial Supervisory Commission, there are 10 major aspects, including virtual asset issuance management, review mechanism for virtual asset delisting and listing, asset separation and custody, transaction fairness and transparency, contract signing, advertising solicitation and complaint handling, operating system and information security and "cold and hot wallet" management mechanism, information announcement disclosure, internal control and institutional audit, individual currency traders and overseas currency traders.
1. Virtual asset issuance management
If there are virtual assets issued through a platform, the issuer should announce the white paper on the website and at least disclose certain content, and the platform should also announce the website link.
2. Review mechanism for virtual assets on and off the shelves
Review standards and procedures should be established for the content of virtual asset white papers and their delisting and listing, and incorporated into the internal control system.
3. Platform assets and customer assets are kept separately
In the platform's virtual asset transactions and payment collection and payment services, the customer's legal currency or virtual assets should be kept separately from the platform's own assets.
4. Fairness and transparency of transactions
The platform should formulate and announce virtual asset trading rules, and establish relevant mechanisms to ensure fair market transactions.
5. Contract conclusion, advertising solicitation and complaint handling
The platform should implement customer protection regulations based on the principles of fairness, rationality, equality, mutual benefit and good faith.
6. Operation system, information security and management mechanism of hot and cold wallets
The platform should establish a management system for its continued operation, information security, and private keys of cold and hot wallets.
7. Information disclosure
The platform should fully announce and disclose matters such as the issuance of the above-mentioned virtual assets, the delisting and listing of products, the separation of asset custody, transaction information and rules, and customer protection.
8. Internal Control and Organizational Audit
The platform should establish mechanisms such as internal control and internal audit systems, ensure that its operations are independent and objective, and agree to accept on-site inspections by the Financial Supervisory Commission or entrusted institutions.
9. Personal currency traders
Natural persons engaged in virtual asset business must submit a declaration of compliance with the Anti-Money Laundering Act to the Financial Supervisory Commission. The content and quality of the declaration must be comparable to that of a legal person.
10. Overseas currency traders
Foreign virtual asset platform operators may not solicit business from Taiwanese in Taiwan unless they have registered in accordance with the Company Act and submitted a statement of compliance with the Anti-Money Laundering Act to the Financial Supervisory Commission.
Huang Tien-mok, Chairman of the Financial Supervisory Commission
According to reports, officials from the Financial Supervisory Commission confirmed that in order to collect external opinions, the Financial Supervisory Commission has recently held a public hearing for industry players and is expected to officially announce the "Guiding Principles for the Management of Virtual Asset Platforms and Trading Businesses (VASP)" before the end of September. Subsequent announcements will be made by the industry. The association further formulates self-regulatory norms.
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After the guidelines were issued,
The next step is to focus on the "Virtual Currency Association"!
Among the above directions, there is the organization of a trade union for Taiwan's virtual currency businesses. Last month, the Ministry of Economic Affairs added the "virtual currency business" industry category to the business group standards.
Regarding the Ministry of Economic Affairs’ announcement to amend the “Business Group Classification Standards” and add the “Virtual Currency Business” group category and business scope, so that virtual currency businesses can apply to form a trade union two months after the notice period, Yang Yueping, associate professor of the Law Department of National Taiwan University, said in an interview with Bit Finance, “The significance of the future virtual asset association is not just to ‘get the ear of the heavens’ and directly connect with the Financial Supervisory Commission!”
Yang Yueping analyzed at the time that, unlike the self-regulatory convention established by the industry five years ago, today's virtual currency industry association has the color of public power and is supported by public power. It is more likely to achieve the following goals under the premise of complying with the anti-money laundering measures:
Direct dialogue with the Financial Supervisory Commission
Accept supervision from the Financial Supervisory Commission
Rules issued under the supervision of the Financial Supervisory Commission
The promulgated rules can be used indirectly by the Financial Supervisory Commission as a basis for law enforcement
Disclaimer: This article is for informational purposes only and does not constitute any investment advice! Always do your own research and consult a professional before making any financial decisions.
Planning and production
Source: Shao Yuanting
Translated/organized by: 9iMxxx | Published by: NFT Gamer
