Taiwan's Financial Supervisory Commission (FSC) has announced the drafting of new anti-money laundering (AML) regulations targeting virtual asset service providers (VASP). These proposed regulations require cryptocurrency firms to register by the end of September 2025, following amendments made to existing laws in July.
The FSC specified that all VASPs must adhere to the new registration process, regardless of their previous compliance declarations. Failure to comply with these regulations could result in penalties, including imprisonment for up to two years and fines reaching NT$5 million (approximately $155,900), as reported by local media.
Kevin Cheng, a prominent crypto lawyer and secretary general of the Taiwan Fintech Association, stated that the new legislation will hold non-compliant operators criminally liable while imposing stricter obligations on compliant firms. He emphasized that the regulatory environment is shifting towards a model resembling licensed financial institutions.
In addition to traditional AML requirements, the new rules will introduce qualifications for management teams and corporate responsibilities, such as transaction security, consumer asset protection, and information security. Cheng noted that these regulations will raise barriers to entry and ongoing operations for industry participants.
Cheng also highlighted that these changes aim to strengthen legal protections for Taiwan's crypto sector, potentially attracting large investors from traditional finance.
The FSC is also considering a dedicated law proposal for crypto assets, which it plans to submit to the Executive Yuan in June 2025. The draft is expected to be completed by the end of this year.
In June, the local crypto industry established an association to develop self-regulatory guidelines under government oversight.
