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Taiwan Advances Crypto Regulation With New VASP and Stablecoin Framework

Taiwan’s Legislative Yuan handed the Virtual Asset Service Act on its third studying on June 30, transferring crypto oversight past slender anti-money-laundering guidelines.

The regulation rewrites how digital asset service suppliers (VASPs) and stablecoin issuers function, introducing licensing necessities, reserve guidelines, and felony penalties.

Taiwan Lawmakers Pass Sweeping Crypto Regulation Law

The Financial Supervisory Commission (FSC) mentioned the framework lifts supervision of digital asset service suppliers (VASPs) from a money-laundering focus towards full operational and market-conduct requirements.

The Act defines seven VASP classes, spanning:

  • Virtual asset exchanges
  • Trading platform operators
  • Transfer service suppliers
  • Custodians
  • Underwriters
  • Lending service suppliers
  • Other digital asset service suppliers

The regulation requires VASPs to segregate buyer property and adjust to inside management, cybersecurity, audit, and financial reporting requirements.

The Act grants a transition interval to current VASPs that accomplished anti-money laundering (AML) registration earlier than the regulation takes impact, in addition to monetary establishments already offering digital asset companies underneath FSC rules. 

These entities should apply for an FSC license inside 12 months of the Act’s implementation. They should additionally acquire regulatory approval and an working license inside 21 months. If mandatory, the licensing deadline could also be prolonged as soon as by as much as three further months.

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Meanwhile, the Act additionally establishes regulatory necessities for stablecoin issuance. It requires entities looking for to challenge stablecoins in Taiwan to acquire approval from the Central Bank of the Republic of China (Taiwan) and authorization from the FSC.

Furthermore, issuers should preserve full reserve backing for all issued stablecoins, place reserve property in belief, endure common audits, and adjust to periodic info disclosure necessities.

“At the identical time, issuing stablecoins throughout the Republic of China will assist Taiwan align with worldwide requirements and safe a spot within the international digital asset market, significantly benefiting the long-term, sound improvement of Taiwan’s digital asset market,” the press launch said.

Penalties escalate sharply for misconduct. Fraud or price manipulation carries a sentence of three to 10 years in jail, plus fines of NT$10 million to NT$200 million ($314,000 to US$6.3 million).

The Executive Yuan will decide when the laws comes into drive.

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The publish Taiwan Advances Crypto Regulation With New VASP and Stablecoin Framework appeared first on BeInCrypto.

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