Taiwanese lawmakers will reportedly submit a draft law specifically for crypto regulations at the end of this year. According to The Block, the crypto regulations were read for the first time at the end of November in an effort to prevent regulatory arbitrage as concerns about foreign exchanges increase in Taiwan. Members Taiwan legislator Yung-Chang Chiang believes that special rules for crypto assets are needed to regulate the rapidly growing crypto industry, which is significantly different from traditional financial products. Chiang recently held a public hearing to discuss a draft proposal with virtual asset service providers , legal experts, and academics.Although Taiwan's Financial Supervisory Commission (FSC) has previously released guidelines for the crypto sector to establish autonomous rules, Chiang argued that these measures lack the force of law.The proposed special law would give authority to authorities regulators to enforce sanctions against operators who do not comply, filling an important regulatory gap in Taiwan's crypto landscape. “In this case, under the authority of this specific law, regulatory authorities can impose administrative sanctions against operators who violate these self-regulation rules. Without such specific legislation, regulators will lose the ability to enforce sanctions,” Chiang added.Currently, Taiwan has been demanding that virtual asset service providers comply with anti-money laundering laws since the FSC introduced anti-money laundering rules in July 2021. Additionally, the crypto industry remains poorly regulated. “There are still many crypto platforms that are in Taiwan but have not declared AML compliance with the FSC,” Chiang said. He added that regulators in Taiwan cannot do much if there is no specific law for crypto Chiang explained that it is likely that this particular law will go through three readings during the current legislative session, which is expected to end at the end of this year.“Elections are approaching, and the current legislative session is more focused on reviewing the government budget,” said Chiang.Currently, Taiwan requires virtual asset providers to comply with anti-money laundering (AML) laws, which were introduced by the FSC in July 2021.However , without specific dedicated legislation, regulators have limited authority to act against non-compliant platforms. Chiang highlighted that many crypto platforms in Taiwan have not declared their AML compliance to the FSC, and this regulatory void needs to be addressed.
