After the United States and Hong Kong successively approved the listing of Bitcoin and Ethereum spot ETFs, the Taiwan Financial Supervisory Commission also announced today (30th) that it will initially allow professional investors to invest in overseas cryptocurrency spot ETFs through "multiple entrustment" methods.
Considering that cryptocurrencies are highly volatile and highly speculative, the Financial Supervisory Commission stated in January this year that Taiwanese investment firms cannot issue cryptocurrency-related ETFs according to law, and cannot even sell overseas Bitcoin ETFs. However, foreign firms come to Taiwan to sell Bitcoins. ETFs are also considered illegal.
According to the "Central News Agency" report, the Financial Supervisory Commission initially prohibited investors from purchasing spot and futures commodities linked to virtual assets through multiple commissions. However, the Securities Dealers Association proposed to the Financial Supervisory Commission in April this year that "conditional opening" of multiple commissions be included in Bitcoin. Spot ETF, and further proposed supporting measures to the Financial Supervisory Commission last month.
In this regard, the Financial Supervisory Commission decided to adopt the recommendations of the Securities Dealers Association and announced today that professional investors are allowed to re-entrust investment in cryptocurrency spot ETFs listed on foreign exchanges, and are not limited to Bitcoin. Ethereum spot ETFs can also invest. However, cryptocurrency futures ETFs have not been released.
According to statistics, there are currently 38 securities firms in Taiwan approved to operate multiple entrustment businesses, including 29 domestic securities firms and 9 foreign securities firms.
Eligibility conditions and supporting measures
According to the Financial Supervisory Commission, due to the high risk of cryptocurrency ETF investment, it is initially only open to "professional investors", which includes: professional institutional investors, high-net-worth investment legal persons, high-asset customers, and legal persons who are professional investors , funds, or natural persons with total assets exceeding NT$30 million.
In addition, the Financial Supervisory Commission also requires securities firms to implement the following supporting measures:
1. Strengthen KYC procedures:
Securities firms should establish an appropriate "suitability assessment system" for cryptocurrency ETF products and submit it to the board of directors for approval. Before the client makes the initial purchase, they should assess that the client has professional knowledge and certain investment experience in cryptocurrency and related product investments. To understand the suitability of the product entrusted by the customer to buy or sell.
2. Sign the risk notice:
Unless the client is a professional institutional investor, the client should sign a risk warning letter before the initial purchase before the securities firm can accept its entrustment.
3. Provide product information:
Unless the client is a professional institutional investor, securities firms should provide cryptocurrency ETF-related product information before the client makes the initial purchase.
4. Regular education and training:
Brokerages should provide regular education and training on cryptocurrency and related products to their business personnel so that they can fully understand the product.
The "Central News Agency" report also mentioned that since this opening does not involve amending the law, after the Financial Supervisory Commission revise the letter, securities companies only need to cooperate with the modification of the internal audit and internal control system to undertake the entrusted investment in cryptocurrency spot ETF business, without having to Submit an additional application to the Financial Supervisory Commission.
When Kuomintang legislator Ge Rujun visited the Financial Supervisory Committee earlier this month, he urged the opening of entrusted investment in Bitcoin spot ETFs as soon as possible. He wrote today:
This opening up will finally allow Taiwanese investors and legal persons to have more diverse asset allocation choices, balance the risks of the real world economy, and implement diversified financial policies.
This should be regarded as the first positive response from the Financial Supervisory Commission to the traditional financial industry’s integration of digital assets and virtual currency products! It's a very important step.
〈Professional investors go first! Taiwan Financial Supervisory Commission: Opening of "multiple commissions" to buy Bitcoin and Ethereum spot ETFs> This article was first published on "Block Guest".
