Taiwan to implement strict Crypto AML rules on November 30

Taiwan’s Financial Supervisory Commission (FSC) will enforce new anti-money laundering (AML) regulations for cryptocurrency service providers starting November 30.

The upcoming rules require crypto exchanges and other virtual asset service providers (VASPs) to register for AML compliance.

Mark AML

The deadline for mandatory AML registration for crypto companies was initially January 1, 2025, but the FSC has pushed it forward by one month.

In a statement on November 28, the regulator said foreign entities offering virtual asset services in Taiwan must establish a local presence and complete the AML registration process under the Companies Act. Currently, 26 crypto providers are authorized to operate in the country, but all, registered or not, must comply with the updated AML requirements.

To help with compliance, the FSC issued a checklist to help platforms identify suspicious activity. They were asked to monitor customer details such as names, bank account information, IP locations and account usage patterns.

In addition, they should also look for unusual transaction activity, such as frequent changes to account information, splitting funds, and using multiple accounts from the same IP address.

Failure to comply could result in severe penalties, including fines of up to NT$5 million ($153,700) and imprisonment of up to two years.

This regulatory push follows the FSC’s decision to penalize two local exchanges, MaiCoin and BitoPro, for multiple violations. On Monday, the exchanges were fined NT$1.5 million each for breaching AML regulations.

According to the agency, crypto companies failed to improve customer due diligence, lacked sufficient knowledge of customers’ sources of wealth, failed to maintain adequate transaction records, and were ineffective in identifying suspicious transaction patterns.

A balanced approach

Taiwan has been actively advancing cryptocurrency regulations as part of its strategy to position itself as a global leader in the digital asset space. In September last year, the FSC introduced ten guiding principles for VASPs to create self-regulatory frameworks.

According to local media reports, these principles are designed to improve transparency by improving information disclosure, establish clear standards for the listing and delisting of virtual assets, and ensure proper segregation and custody of funds customers and the company.

Most recently, it revealed plans to introduce a registration system that would require cryptocurrency exchanges to register with the Taiwanese government by September 2025.

While the government has strengthened its oversight, it is also introducing measures to encourage the growth of the sector. Last month, the financial watchdog granted professional investors access to exchange-traded funds (ETFs) linked to foreign digital assets.

In addition, the regulator is preparing a pilot program for institutional custody of cryptocurrency, with applications to open in early 2025. Three private banks have already expressed interest in participating in the initiative.

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