Taiwan to Clamp Down on Unregistered Offshore Crypto Exchanges

Taiwan intends to limit access to offshore cryptocurrency exchanges that do not adhere to local regulatory rules in an effort to improve monitoring of the sector. The Financial Supervisory Commission of the nation has just created 10 guidelines for policing regional bitcoin service providers. By the end of September, these concepts should become official.

The implementation of anti-money laundering (AML) controls and the listing and delisting of digital assets are only a few of the actions related to cryptocurrencies that are covered by the new regulatory standards. These guidelines are intended to promote an environment for bitcoin trading in Taiwan that is more safe and open.

After the principles are made known later this month, it will be up to public institutions to create their own set of regulatory standards. These preliminary guidelines may be changed to comply with global norms and take into account recent advances in scientific knowledge.

Taiwanese regulators have provided the following important guidelines concerning digital assets:

The Guidelines

1. Digital Asset Issuance Management: Issuers must publish their digital asset white paper on their official websites, providing essential information. Cryptocurrency platforms should also establish links to the issuers’ sites for transparency.

2. Asset Listing and Delisting Review: Companies operating in the cryptocurrency space must establish clear criteria and processes for reviewing the content of digital asset white papers. These criteria should be integrated into their internal control systems, particularly regarding the listing and delisting of assets.

3. Asset Separation: Cryptocurrency platforms are required to maintain a clear separation between customers’ legal currency or digital assets and the platform’s assets during transactions. This measure aims to protect customers’ funds.

4. Trading Fairness and Transparency: Platforms must create and disclose trading rules for digital assets to ensure fairness in the market.

5. Contract, Advertising, and Complaints: Platforms should conduct their operations in a fair and transparent manner, emphasizing customer protection and mutual benefit.

6. Operational Systems and Security: Cryptocurrency platforms must establish robust management systems for operations, information security, and the safeguarding of hot and cold wallet private keys.

7. Information Disclosure: Platforms are obligated to transparently disclose information related to digital asset issuance, product listings, asset segregation, trading information, and customer protection.

8. Internal Control and Audits: Platforms must have effective internal controls and undergo regular audits, allowing regulatory bodies to conduct on-site checks.

9. Equal Anti-Money Laundering Oversight: Individuals involved in digital asset businesses who declare compliance with AML rules must meet the same standards as corporate entities.

10. Overseas Dealer Restrictions: Foreign digital asset platforms that are not registered according to Taiwanese company laws and fail to comply with anti-money laundering regulations are prohibited from soliciting business in Taiwan.

These guidelines are in line with global norms for preventing illegal financial activity and show Taiwan’s commitment to supporting a responsible and regulated cryptocurrency economy. The nation seeks to combine innovation and security in the rapidly changing world of digital assets.