Taiwan will not regulate against initial coin offerings (ICOs) and cryptocurrencies like bitcoin and will avoid the hardline stance taken by the likes of China and South Korea.
In significant news today, Taiwan’s Financial Supervisory Commission chairman Wellington Koo has told a joint session of the parliament and the cabinet today that Taiwan will not follow the paths of China and South Korea in an outright ban on crypto-related activity. Instead, the head of Taiwan’s financial regulator pledged to adopt a friendlier stance to support the development and adoption of both cryptocurrencies and blockchain technology in the country.
As reported by The News Lens, Koo expressed the official stance following a request by legislator Jason Hsu, a congressman from Taiwan’s Nationalist party which has long adopted a deregulatory pro-FinTech stance.
In quotes reported by the publication, Hsu stated:
Just because China and South Korea are banning, 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.
According to Hsu, today's statements by Koo will also be followed by the successful passing of the "Financial Technology Innovation Experimentation Act", in the same parliamentary session. If the bill passes, the legislation will effectively establish a fintech sandbox for cryptocurrency and blockchain startups in a deregulated space.
Today's comments from Taiwan's regulatory chief represents a decidedly different approach to regulating cryptocurrencies and initial coin offerings (ICOs), a radical new form of fundraising powered by cryptocurrencies like bitcoin and ether.
A little over a month ago, China’s central bank announced a blanket ban on all ICOs, deeming them to be an illegal method of fundraising. The draconian legislation snowballed and is leading to the shuttering of bitcoin exchanges in mainland China. A week ago, South Korea followed suit and banned ICOs regionally. Japan, on the other hand, moved to follow legislation that acknowledged bitcoin as a legal method of payment from April this year.
Last week, Hsu described the crippling regulation lead to "a chain reaction" of warnings by regulators and watchdogs around the world.
"I am worried that with both China and South Korea banning ICOs, all this hot money will flow into Taiwan’s stock market and real estate," Hsu was reported as stating by the Financial Times last week. Any fears of Taiwan joining China and South Korea with blanket bans, as suggested by the FT report, have now been quelled by the friendlier regulator move by Taiwanese authorities today.