Taiwan Passes Virtual Asset Services Act with Licensing Requirements for VASPs and Stablecoin Issuers

According to Foresight News citing Taiwan Times, Taiwan's legislature recently passed the Virtual Asset Services Act, establishing a comprehensive regulatory framework for the crypto industry. Virtual asset service providers (VASPs) must obtain approval from the Financial Supervisory Commission to operate. Existing VASPs that completed anti-money laundering registration have 12 months to apply for licenses and 21 months to receive regulatory approval. Stablecoin issuers must maintain sufficient reserves held by domestic financial institutions, isolated from other assets and protected from creditors in bankruptcy proceedings.

The law imposes strict penalties for violations. Operating an unlicensed VASP or issuing stablecoins without authorization carries up to 7 years imprisonment and fines up to TWD 100 million (approximately $3.14 million). Fraudulent activities or price manipulation involving virtual assets face 3 to 10 years imprisonment and fines of TWD 10 million to TWD 200 million.