Wellington Koo, the Financial Supervisory Commission (FSC) chairman, today expressed his desire for Taiwan to emulate Japan’s cryptocurrency regulations, also suggesting that he does not wish to adopt a heavy-handed legislative approach to ICOs. The statements have been made in the lead up to Taiwan’s “Financial Innovation Experimentation Act” going before parliament – a bill designed to facilitate the creation of regulatory sandboxes pertaining to Taiwan’s fintech industry.
Taiwan’s Financial Supervisory Commission Chairman Has Indicate His Reluctance to Develop Heavy-Handed Cryptocurrency Regulations
The News Lens reports that the Financial Supervisory stated that he would not regulate against bitcoin, describing cryptocurrency and distributed ledger technologies as representing a major potential growth industry for Taiwan.
The statements came in response to a request for a clarification of Taiwan’s official position regarding cryptocurrency. The question was asked by congressman Jason Hsu of the Kuomintang Party during a joint session of parliament and cabinet. Hsu described Koo’s position as importantly paving the way for the “Financial Innovation Experimentation Act”.
The Financial Innovation Experimentation Act is a bill that was proposed by the Executive Yuan in May. The bill proposes the development of a “regulatory sandbox” approach to the fostering of innovation within experiment sectors of Taiwan’s fintech industry. K&L Gates recently published an article arguing that if passed, the bill would “enable experiment[ation with] innovative financial technology within a well-defined space and duration under relaxed legal requirements.” The bill is seen to comprise the legislative realization of the 2016 whitepaper published by Taiwan’s Financial Supervisory Commission, in which the FSC advocated both private and public “efforts in the research and development of blockchain technology applications”.
Taiwan’s Parliament Will Consider a Bill Designed to Promote the Development of Regulatory Sandboxes for Taiwan’s Fintech Industries
Hsu advocated that Taiwan adopt a regulatory framework similar to that of Japan, and avoid the legislative path undertaken by China and South Korea – suggesting that the congressman is in favor of encouraging innovation within the emerging ICO industry in addition to adopting regulations favorable to bitcoin ownership and use. Hsu stated “just because China and South Korea are banning [ICOs], doesn’t mean that Taiwan should follow suit – there is a huge opportunity for growth in the future… We should emulate Japan, where they treat cryptocurrency as a highly regulated, highly monitored industry like securities.”
Taiwan’s cryptocurrency and distributed ledger technology industries have shown signs of significant development in recent years. The country’s sole virtual currency exchange platform, Maicoin, currently hosts approximately 25,000 active users – which equates to approximately 1 out of every 1000 Taiwanese citizens. Maicoin’s sister company, Amis, is currently seeking to develop a private blockchain consortium alongside Taiwanese financial institutions – having so far struck deals with Taipei Fubon Bank and Taishin International Bank. Several off-shore based bitcoin exchanges have also recently sought to enter Taiwan’s cryptocurrency markets in recent months, including Hong Kong’s Tidebit and Japan’s Bitpoint.