Taiwan has passed amended anti-money laundering (AML) and counter terrorism financing (CFT) laws to place additional requirements on cryptocurrency exchanges. The new regulations have also given Taiwan’s Financial Supervisory Commission (FSC) the power to stop anonymous crypto transactions.
The FSC can now make KYC processes for exchanges mandatory, enabling banks to block transactions if they seem suspicious. The Ministry of Justice of Taiwan has stated that these new regulations allow Taiwan to more closely align with international AML standards, thereby, automatically helping the country nation to foster a compliance culture and mindset among local institutions and businesses.
Initial Coin Offerings (ICOs) have been the reason for creating tension throughout international jurisdictions that are keen on averting customer exposure to fraud. Before this development, some government officials led by Jason Hsu launched a self-regulatory body for the country’s cryptocurrency and blockchain industry.
Last year, the country’s lawmakers passed the Financial Technology Innovations and Experiments Act to create a “sandbox” for innovative fintech companies. Companies that meet the law’s assessment will be allowed to operate without regulatory risks (for a specific period). ICOs for example who gain the approval of the FSC will be allowed to bypass certain regulatory requirements.