Taiwan’s Financial Supervisory Commission has introduced the draft for the “Virtual Asset Service Act,” which aims to clarify regulations for virtual asset businesses while bolstering investor protections.
On March 25, Taiwan’s FSC presented the draft of the “Virtual Asset Service Act,” detailing licensing provisions for Virtual Asset Service Providers, guidelines for stablecoin issuance, and measures focused on market integrity and investor safety.
The draft specifies requirements for VASPs, including criteria for organizational structure, capital adequacy, and qualifications of personnel. It also gives banks the authority to issue stablecoins linked to the New Taiwan Dollar, provided they receive FSC approval and adhere to established standards. Furthermore, to maintain market integrity, the FSC is empowered to conduct audits, enforce compliance, and impose penalties for violations.
A 60-day public consultation period has been launched by the FSC to gather input from stakeholders regarding the draft, with plans to present the finalized legislation to the Executive Yuan by June 30.
The initiative regarding the “Virtual Asset Service Act” reflects Taiwan’s dedication to enhancing regulatory clarity surrounding virtual assets, safeguarding investors, and addressing money laundering concerns. Efforts to strengthen regulations began in October 2024 when the FSC updated Anti-Money Laundering protocols, mandating that all VASPs register with the government by September 2025, or face repercussions, with the regulations set to take effect on January 1. Under these regulations, VASPs are also required to prepare an extensive risk assessment report annually and submit it to the FSC by the end of March of the subsequent year.
In addition to enhancing regulatory clarity within the crypto landscape, the FSC has been actively fostering institutional adoption of cryptocurrencies through a variety of strategic measures. Notably, the FSC launched a pilot program for crypto custody services in early 2025 and has approved several foreign crypto exchange-traded funds aimed at professional investors.