Stablecoin issuer / redeemer in Taiwan

Financial Supervisory Commission (FSC): Responsible for financial markets, banking, and securities, and has taken the lead in VASP regulation.

Taiwan's FSC has proposed the Virtual Asset Services Act (2025), which provides a comprehensive regulatory framework for virtual assets including stablecoins, moving beyond just AML/CFT to cover licensing, custody, exchange, and investor protection, though the law is still a draft and not yet enacted.

E-money/Payment Tokens/Securities: The FSC is actively studying international developments (e.g., MiCA in Europe, discussions in the US) and has indicated that future legislation might categorize stablecoins based on their design and function:

E-money Tokens: Stablecoins pegged to fiat currency and intended for payments could be regulated similarly to e-money.

No specific stablecoin reserve requirements: As there is no dedicated stablecoin issuance regime, there are no prescribed statutory reserve requirements for stablecoin issuers in Taiwan.

VASP Guidelines (Safeguarding Client Assets): However, if a VASP offers custody services for stablecoins or holds fiat assets on behalf of clients (which might include funds used to back stablecoins), the "Guidelines for Virtual Asset Service Providers" issued by the FSC mandate that VASPs must:

Segregate client assets from their own proprietary assets.

Safeguard client assets appropriately, often through trust arrangements or full deposit insurance for fiat.

Future Outlook: Any future stablecoin legislation is expected to include robust reserve requirements, likely mirroring international standards demanding full backing (1:1) with high-quality, liquid assets, regularly audited and publicly disclosed.

No specific stablecoin issuer license: Currently, there is no distinct license required specifically for the issuance of stablecoins in Taiwan.

VASP Registration and Compliance: Entities that provide services related to virtual assets, including stablecoins (e.g., exchange, transfer, custody), are considered Virtual Asset Service Providers (VASPs) and must:

No specific statutory redemption rights for stablecoins: In the absence of a dedicated stablecoin law, there are no specific statutory provisions granting redemption rights to stablecoin holders from the issuer.

Contractual Terms: Redemption rights would currently be governed by the terms and conditions set by the stablecoin issuer or the VASP facilitating the stablecoin.

Future Outlook: Robust redemption rights (1:1 redemption for fiat) are a cornerstone of stablecoin regulation internationally. It is expected that future Taiwanese legislation will mandate clear and enforceable redemption rights for stablecoin holders, similar to e-money regulations.

No specific rules: Taiwan does not currently have specific regulations for algorithmic stablecoins.

Skepticism: Given the instability and failures of algorithmic stablecoins globally, it is highly probable that Taiwan would either impose very stringent requirements that would be difficult for algorithmic stablecoins to meet, or outright prohibit them as part of any future comprehensive stablecoin legislation. The focus is likely to be on fully-backed stablecoins.

FSC — VASP guidelines and oversight — dedicated law under legislative review

Guiding Principles for Management of Virtual Asset Service Providers (2023) — VASP registration and conduct guidelines (being formalized into law, expected 2025-2026)

VASP: VASP Registration under FSC guidelines (3-6 months). Dedicated VASP law under legislative review. Approach influenced by Japan and Singapore models. MaiCoin and BitoPro are major local players.

CUSTODY: Customer asset segregation required under FSC guidelines

FSC Guidelines and Oversight: The FSC issues guidance (e.g., VASP Application Guidance, AML/CFT Notes, Travel Rule Guidance) and FAQs (latest published November 21, 2025) covering VASP definitions, registration, compliance obligations like AML/CFT systems, audits, and record-keeping, plus supervisory powers including enforcement and risk-based monitoring.

Regulations Governing Anti-Money Laundering and Countering Terrorism Financing for Virtual Asset Service Providers (虛擬通貨平台及交易業務事業防制洗錢及打擊資恐辦法)

These regulations require VASPs to implement robust internal control systems for AML/CTF, report suspicious transactions, and conduct due diligence.

Segregation of Client Assets Rules:

Comprehensive VASP Special Law: The FSC has publicly announced its intention to establish a dedicated and comprehensive regulatory framework for virtual assets, moving beyond just AML/CTF.

Gains from the sale of cryptocurrencies are considered "Other Income" (其他所得) under Article 14 of the Income Tax Act.

Businesses Selling Cryptocurrency: The direct sale of cryptocurrencies by a business might be subject to Business Tax (VAT) at the standard rate of 5% if it's considered a sale of goods or a taxable service. However, there's ongoing debate and lack of absolute clarity on whether cryptocurrency itself is a "good" or "service" for direct VAT application.