Taiwan Government Sets National ICO Standards

The government of Taiwan under its FSC is drafting a set of national standards for ICOs. The government agency revealed it wants to make investing in tokens comparable to stocks.

Taiwan Finally Steps to Regulate ICOs

Taiwan Financial Supervisory Commission (FSC) reports indicate that the commission is drafting a set of national standards for ICOs. The reports were confirmed by the chairman of the FSC Wellington Koo. Taipei Times, a Taiwanese news agency reports on Oct 23 that the FSC is aiming to make virtual tokens as easy to invest in as stocks and just as liquid.

This follows a recent meeting where a Chinese lawmaker William Tseng attached to the Chinese Nationalist Party (KMT) ask Koo whether Taiwan would regulate ICOs. The legislator was expressing his concern about a report. It indicates that over 127 ICO white papers last year was fake.

According to the global report, another 80 ICO whitepapers were inaccurate. William Tseng also quotes a finding from Satis Group that shows that 81 percent of ICOs are scams. Replying to the law maker’s concern Koo says that;

“The commission would regulate ICOs … [but] tokens exchanged for goods, such as those used in accruing points at convenience stores or mileage points accepted by airlines, would not be covered by the standards.”

China shows its deep involvement in investigating the legitimacy of different ICOs around the globe. Despite its current ban on ICOs and cryptocurrency. In a report of May 2018 by China’s National Committee of Experts on the Internet Financial Security Technology, a Chinese government-industry organization, 421 fake ICOs were identified.

In an independent analysis of 1,450 ICOs, the Wall Street Journal reported that 271 were suspicious. The criteria the wall street journal inspected include Legitimacy of investor document, business model and executive team members.

Cryptocurrency is not a Security Token

According to Taiwan’s Securities and Futures Bureau Deputy Director-General Tsai Li-ling ICO is distinctive from cryptocurrency trading. The governor of Taiwan’s Central bank Yang Chin-long told the finance committee that “the government tends to regard cryptocurrencies as virtual commodities or assets rather than currencies because they have no intrinsic value.” He continued stating that,

“Cryptocurrency trading is similar to trading in gold, for which the commission only implements money laundering controls.”If a token function similar to a security, “the commission will define it as a ‘securities token’. Thereafter subject it to the Securities and Exchange Act,”

Reports indicate that Taiwan’s ICO Standards draft will complete by June 2019. The FSC iterates that it has no intentions to hurt creativity and productivity relating cryptocurrencies if not as securities.

The Chairman at FSC in June 2018, says the more crypto industry regulates, the more he continues to function in hibernation. This follows a report that FSC was considering a limited oversight on crypto. Moreover, putting much focus on anti-money laundering measures.

Many nations are coming up to regulated ICO and cryptocurrencies activities. What do you think about this move by the Taiwanese Government? However, there are hundreds of dubious ICOs that need to stop completely to protect investors.

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Jacob Okonya

Jacob has been engaged in blockchain technologies, Bitcoin, and fintech. He worked mostly as a blockchain market researcher, fintech journalist, and online forum moderator. Jacob is involved in creating articles and educational content for different project components, explaining how users can utilize the various resources.

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