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Taiwan Authorities Crack Down on Cryptocurrency Firms
Taiwan authorities have announced plans to enforce stricter anti-money laundering (AML) laws on cryptocurrency firms to combat fraud and money laundering risks in the virtual asset landscape. The Ministry of Justice in Taiwan has proposed amendments to existing AML laws that could lead to hefty fines and imprisonment for non-compliant service providers.
Key Amendments Proposed by Taiwan’s Ministry of Justice
- Mandatory registration for AML compliance for domestic and overseas crypto firms
- Imprisonment of up to two years and fines up to $1.5 million for non-compliance
- Regulations targeting fraud prevention, money laundering prevention, technology investigation and security, and communications security and supervision
- Harsher penalties for noncompliance, including stricter registration requirements and limitations for currency dealers
One major change in the proposed amendments is the introduction of stricter penalties for Virtual Asset Service Providers (VASPs) who fail to comply with the new regulations. VASPs could face imprisonment if they provide services without proper registration. The amendments also address money laundering offenses related to third-party payment accounts and virtual asset accounts.
Impact on Overseas Crypto Platforms
Under the proposed amendments, overseas crypto platforms must establish local entities and apply for AML registration to avoid criminal penalties. The amendments will also bring cryptocurrency within the scope of existing AML laws, with offenders using cryptocurrency for money laundering facing prison terms and fines.
Legislative Review and Industry Self-Regulation
The Legislative Yuan, Taiwan’s national parliament, will review the proposed amendments. Deputy Minister of Justice Huang Mou-hsin emphasized that the amendments would elevate violations by crypto firms to criminal offenses, potentially leading to imprisonment.
Taiwan has been taking steps towards regulating the crypto industry, with the Financial Supervisory Commission introducing anti-money laundering rules for cryptocurrency service providers in July 2021. The latest proposal aligns with plans to introduce new laws for digital assets by September 2024.
Furthermore, Taiwan’s crypto sector is moving towards establishing an industry association to collaborate with regulatory authorities. Key players in the industry have joined forces to strengthen the sector and enhance cooperation with regulatory bodies.
In a significant development, the Financial Supervisory Commission granted Taiwan’s inaugural security token offering license to Cathay Securities, enabling the issuance of tokenized green bonds valued at $930,000 every six months.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
