A chief financial regulator relates virtual assets to online gambling, in its note to the banking sector,
Taiwan’s Financial Supervisory Commission (FSC), a chief financial regulator, recently warned the banking industry not to grant the virtual assets providers (VASPs) the status of merchant in operations with credit card holders. That means buying crypto with a credit card on the island is a de-facto banned.
As the local media reported on Thursday, July 21, the Financial Supervisory Commission sent a letter to the Association of Banks in early July, reminding the members of the Association of Banks that virtual assets are highly speculative and risky, and the cash flow is complex and challenging to monitor transactions effectively.
The financial regulator has also specified that credit cards are primarily consumer payment tools, and not investment and wealth management or payment tools with high speculative, high risk and high financial leverage transactions.It has been a longstanding tradition of protecting credit card holders from paying for online gambling, stocks, futures and options, among other things.
The FSC sets a requirement for banks to adjust to the new guidelines within three months. The audit unit will then review its internal compliance and report the results to the regulator.
This is not the first time FSC has acted on or voiced its disapproval about crypto. The regulator published several press releases last year to remind the public of related risks associated with virtual assets.
Based on the Financial Action Task Force’s recommendation, Taiwan enacted the renewed Anti-Money Laundering (AML) requirements for cryptocurrency exchanges in July 2021,
The governor of the Central Bank of the Republic of China (Taiwan) has recommended a no-interest design for the country’s central bank digital currency (CBDC) pilot at the end of June. its central bank currently provides the CBDC to five selected Taiwanese banks for distribution among consumer, in which Taiwan is currently in the second stage of its CBDC pilot program.