{"id":45944,"date":"2025-01-23T15:18:48","date_gmt":"2025-01-23T15:18:48","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/taiwan-fsc-proposes-stablecoin-framework-for-banks-to-issue-twd-tokens\/"},"modified":"2025-01-23T15:18:48","modified_gmt":"2025-01-23T15:18:48","slug":"taiwan-fsc-proposes-stablecoin-framework-for-banks-to-issue-twd-tokens","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/taiwan-fsc-proposes-stablecoin-framework-for-banks-to-issue-twd-tokens\/","title":{"rendered":"Taiwan FSC proposes stablecoin framework for banks to issue TWD tokens"},"content":{"rendered":"

(Originally posted on : Invezz )<\/b>
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Taiwanese local media outlet, Money UDN reports<\/a>, the Taiwan Financial Supervisory Commission (FSC) has announced a game-changing proposal to regulate stablecoins, aiming to redefine the country\u2019s approach to digital assets. <\/p>\n

In a bold move, the FSC is drafting laws that will allow local banks to issue stablecoins pegged to the New Taiwan Dollar (TWD).<\/p>\n

Unlike most stablecoins tied to the US dollar, this initiative emphasises financial sovereignty while addressing the risks associated with unregulated crypto markets.<\/p>\n

The proposed framework is expected to strengthen Taiwan\u2019s virtual asset ecosystem, ensuring that locally issued stablecoins comply with strict financial regulations. <\/p>\n

The central bank will oversee these issuances, guaranteeing transparency and mitigating risks to financial stability.<\/p>\n

This regulatory shift could position Taiwan as a significant player in the global cryptocurrency landscape while maintaining strict adherence to monetary policy.<\/p>\n

Stablecoin regulation prioritises domestic control<\/h2>\n

The proposed draft law highlights the Taiwan FSC’s focus on localised financial control. <\/p>\n

Unlike stablecoins such as Tether (USDT) and USD Coin (USDC), often criticised for their opaque backing, Taiwan’s stablecoins will undergo stringent oversight.<\/p>\n

The central bank will collaborate with issuers to ensure these tokens are backed by verifiable reserves, directly linked to the TWD.<\/p>\n

This shift marks a departure from the global trend of pegging stablecoins to foreign currencies like the US dollar. <\/p>\n

By anchoring stablecoins to the TWD, Taiwan seeks to strengthen its monetary policy while minimising exposure to foreign exchange risks.<\/p>\n

Issuers will also need to meet rigorous requirements, including reserve allocations and adherence to the forthcoming virtual asset service provider (VASP) regulations.<\/p>\n

The FSC’s approach aligns with Taiwan\u2019s broader regulatory agenda, which includes anti-money laundering (AML) measures for VASPs. <\/p>\n

These measures, introduced in January 2025, mandate annual risk assessments and compliance with AML protocols. <\/p>\n

By integrating stablecoin issuance into this framework, Taiwan aims to mitigate the risks often associated with decentralised finance (DeFi) platforms and unregulated crypto markets.<\/p>\n

Taiwan central bank tackles global stablecoin dominance<\/h2>\n

The FSC\u2019s proposal also challenges the dominance of global stablecoins by setting a higher standard for legitimacy. <\/p>\n

Popular stablecoins like Tether and USD Coin have often been criticised for lacking transparency and relying on private firms to declare their backing.<\/p>\n

Taiwan\u2019s approach ensures that any locally issued stablecoin is vetted by the FSC and backed by central bank oversight.<\/p>\n

While this move could limit the use of foreign stablecoins within Taiwan, it also creates opportunities for local banks to innovate. <\/p>\n

By issuing TWD-pegged tokens, banks can bridge the gap between fiat and cryptocurrency markets, making digital assets more accessible to Taiwanese investors.<\/p>\n

The FSC also plans to launch a pilot programme for banks to offer crypto custody services in early 2025. <\/p>\n

This initiative complements the stablecoin proposal by encouraging financial institutions to engage with digital assets in a regulated environment. <\/p>\n

Such developments could enhance consumer trust in cryptocurrencies while ensuring compliance with local laws.<\/p>\n

Challenges to adoption and future prospects<\/h2>\n

Despite its ambitious plans, Taiwan faces challenges in integrating stablecoins into the broader economy. <\/p>\n

The central bank has identified hurdles related to monetary policy and financial stability, which need resolution before stablecoins can be widely adopted for everyday transactions.<\/p>\n

For now, the FSC\u2019s proposal focuses on creating a robust regulatory foundation. <\/p>\n

By prioritising financial stability and compliance, Taiwan aims to foster innovation without compromising its economic sovereignty. <\/p>\n

If successful, this initiative could set a precedent for other nations exploring stablecoin regulation.<\/p>\n

With the virtual asset market evolving rapidly, Taiwan\u2019s move to regulate stablecoins reflects its commitment to balancing innovation with oversight. <\/p>\n

As banks prepare to issue TWD-pegged tokens, the country\u2019s financial sector is poised to take a significant step into the digital future.<\/p>\n

The post Taiwan FSC proposes stablecoin framework for banks to issue TWD tokens<\/a> appeared first on Invezz<\/a><\/p>\n

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(Originally posted on : Invezz ) Taiwanese local media outlet, Money UDN reports, the Taiwan Financial Supervisory Commission (FSC) has announced a game-changing proposal to regulate stablecoins, aiming to redefine the country\u2019s approach to digital assets. In a bold move, the FSC is drafting laws that will allow local banks to issue stablecoins pegged to […]<\/p>\n","protected":false},"author":3947362361,"featured_media":45945,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0},"categories":[38],"tags":[],"_links":{"self":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts\/45944"}],"collection":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/users\/3947362361"}],"replies":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/comments?post=45944"}],"version-history":[{"count":0,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts\/45944\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/media\/45945"}],"wp:attachment":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/media?parent=45944"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/categories?post=45944"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/tags?post=45944"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}