Bitrabo Editorial
The Taiwanese financial regulatory body is contemplating a trial for crypto custody services aimed at institutions, with various local banks under review for a potential pilot program.
Taiwan’s Push to Incorporate Cryptocurrency into the Financial Framework
The Financial Supervisory Commission (FSC) of Taiwan is looking to introduce digital asset custody services through local banks.
Beginning in the first quarter of 2025, the FSC intends to gather applications from financial entities interested in participating in the custody services trial. So far, three banks have shown their interest in being part of this initiative.
Insiders indicate that banks wanting to join the trial will need to indicate the specific type of cryptocurrency they plan to hold, which could include Bitcoin (BTC), Ether (ETH), or Dogecoin (DOGE), among others.
With the total market cap of the crypto sector exceeding $2.2 trillion, stringent security guidelines for participating institutions will be enforced.
These institutions must outline their intended user demographics, covering professional investors, retail investors, and digital asset-related entities. They are also expected to create robust security systems and measures to counter money laundering.
Moreover, these banks need to implement security protocols to ensure they do not deal with illicit digital assets, as failure to do so could lead to the confiscation of their crypto wallets by regulatory bodies.
Hu Zehua, the FSC’s Director, noted that the agency will disclose more details about the trial at least 15 days before they start accepting applications. The FSC plans to gather public opinions on this proposal and make adjustments as necessary.
Recent regulatory changes show Taiwan’s evolving attitude towards digital assets. For example, on September 30, the FSC granted permission for institutional investors to engage with foreign cryptocurrency exchange-traded funds (ETFs) through a re-entrustment method.
Asia’s Crypto Sector Matures
Taiwan’s move towards digital assets highlights their increasing role in enhancing the local economy. It’s a trend mirrored across the Asian continent.
Japan is reportedly contemplating revisions to its digital asset regulations, which may lead to reduced taxes on crypto profits and approval for ETFs.
The United Arab Emirates (UAE), another significant player in the crypto space, has declared that all transactions concerning digital asset conversions will be exempt from Value Added Tax (VAT) as part of its strategy to draw crypto investments into the region.
Nonetheless, regulators remain wary about the risks associated with cryptocurrencies for individual investors. A recent study revealed that about 70% of Bitcoin exchanges in South Korea were unable to return customers’ funds after shutting down their operations. At the moment, Bitcoin is trading at $62,303, reflecting a 0.1% decrease in the last 24 hours.
