Taiwan has enacted a robust new law to oversee its cryptocurrency sector, now awaiting the President's final approval.
By Omkar Godbole, AI Boost Jul 1, 2026, 5:04 a.m. 2 min readMake preferred on ShareShare this articleCopy linkX (Twitter)LinkedInFacebookEmailMake preferred on Taiwan implements new crypto regulations. (Vas/Unsplash)SummaryShow- Taiwan has enacted a comprehensive law regulating its cryptocurrency sector, mandating that all virtual asset service providers obtain licenses and adhere to enhanced operational, governance, and custody requirements.
- The new legislation imposes strict penalties for non-compliance and establishes stricter regulations for stablecoins, marking a transition from minimal AML oversight to extensive regulatory control.
Taiwan has made significant progress in regulating its digital asset industry by passing comprehensive new rules governing cryptocurrency activities.
On Tuesday, the Legislative Yuan approved the Virtual Asset Service Act during its third reading, sending it to President Lai Ching-te for formal endorsement, which is expected within ten days.
After the President's signature, the Executive Yuan will determine the official launch date for the regulations.
This new law mandates that all virtual asset service providers, including crypto exchanges and platforms, obtain specific licensing from the Financial Supervisory Commission (FSC) before legally operating in Taiwan.
It also imposes stricter cybersecurity standards, mandates the separation of customer funds from company assets, and enhances internal governance and risk management protocols.
Existing platforms that have registered for anti-money laundering compliance will have a 12-month grace period to apply for licenses and up to 21 months total to secure full FSC approval and any additional necessary permits. Previously, crypto businesses in Taiwan were only required to register for anti-money laundering compliance.
Those engaged in stablecoin activities will face additional challenges, needing approval from both the central bank and the FSC while maintaining 100% asset reserves at all times. Stablecoins are cryptocurrencies pegged to external references like the U.S. dollar or other fiat currencies. The BIS has recently cautioned about the foreign-exchange risks associated with dollar-pegged stablecoins.
The legislation outlines severe penalties for violations, with unauthorized operation of crypto platforms or stablecoin services potentially leading to prison sentences of up to seven years and fines reaching NT$100 million (approximately $3.14 million).
Furthermore, offenses related to market fraud or price manipulation could incur even harsher penalties: three to ten years in prison and fines between NT$10 million and NT$200 million.
RegulationAI Disclaimer: Portions of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk's full AI Policy.Latest Crypto News- 1XRP maintains above $1 post-leverage flush as network activity improves31 minutes ago
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