The new Taiwan anti-money laundering regulations will take effect on 11/30, and unregistered entities will not be able to provide virtual asset services.

The Financial Supervisory Commission (FSC) released an announcement yesterday, stating that Article 6 of the Money Laundering Prevention Act will be implemented starting from November 30th. After this date, exchanges and individual currency traders who have not completed the registration under the Money Laundering Prevention Act will be prohibited from providing virtual asset services. Failure to register and provide services in accordance with the law may result in criminal liability of up to 2 years and a fine of up to 5 million. (Background: The Executive Yuan passed the 'Anti-Fraud New Four Laws': Overseas exchanges and individual currency traders must register, and penalties have been determined) (Background: The amendment to the Money Laundering Prevention Act has passed the third reading: Overseas exchanges and virtual currency traders must register, with a maximum penalty of 2 years imprisonment and a fine of 5 million) On July 16th, the Taiwan Legislative Yuan passed the 'Amendment to the Money Laundering Prevention Act,' which was officially announced on July 31st and came into effect on August 3rd. One of the key amendments is to 'strengthen the supervision of virtual asset services and strictly prevent money laundering through virtual assets.' The newly added Article 6 for the first time incorporates 'virtual asset services' into formal regulations, attracting attention from the cryptocurrency industry in Taiwan and overseas. Article 6 of the Money Laundering Prevention Act will be implemented on November 30th. Against this background, the Financial Supervisory Commission announced yesterday (27th) that Article 6 of the Money Laundering Prevention Act will be implemented starting from November 30th: Article 6 of the Money Laundering Prevention Act promulgated on July 31, 113, will be implemented on November 30, 113. According to the above provisions, businesses or individuals providing virtual asset services who have not completed the registration under the Money Laundering Prevention Act with the competent authority shall not provide virtual asset services. Businesses or individuals providing virtual asset services established overseas, if they have not completed the registration as a company or branch in accordance with the Company Act and have completed the registration under the Money Laundering Prevention Act, shall not provide virtual asset services within Taiwan. Violators may face criminal liability of up to 2 years. The most important thing to note is that whether you are an exchange or an individual currency trader, you need to complete the registration under the Money Laundering Prevention Act with the competent authority. If you provide virtual asset services after November 30th without registering according to the law, you will be in violation of the Criminal Code and may be sentenced to imprisonment for up to 2 years, detention, or a fine of up to 5 million. Legal persons may also be subject to a fine of up to ten times the amount. The definition of 'providing virtual asset services' is unclear, which may lead to legal disputes. For example, if someone acts as a custodian or engages in the buying and selling of cryptocurrencies for friends, does it count as a form of 'providing virtual asset services'? If there is a dispute between the parties, would the judge determine guilt based on the Money Laundering Prevention Act if the accused did not register under it? In response to these concerns, an anonymous encryption company commented to BlockTempo: The legislators do not seem to understand that the ultimate goal of cryptocurrencies is to lower the barriers in finance, enabling everyone to use unrestricted financial services. Such legislation only limits the use of cryptocurrencies and fails to fully control the services provided by cryptocurrencies. It may lead to more underground transactions. Definition of businesses or individuals providing virtual asset services Based on Article 6, Paragraph 2 of the latest Money Laundering Prevention Act announced by the FSC, businesses or individuals providing virtual asset services refer to businesses or individuals engaged in the following activities for others within Taiwan: Exchange between virtual assets and New Taiwan Dollars, foreign currencies, and currencies issued in mainland China, Hong Kong, or Macau. Exchange between virtual assets. Transfer of virtual assets. Custody, management of virtual assets, or provision of related management tools. Participation in and provision of related financial services for virtual asset issuance or sales. Will Taiwan relax its regulatory standards in the future? On the other hand, after Donald Trump was elected as the President of the United States, many countries and companies gradually changed their conservative attitudes towards cryptocurrencies and Bitcoin, which has led to an increasing acceptance of cryptocurrencies internationally. However, under the current rapidly changing global context, Taiwan's regulation of cryptocurrencies appears to be somewhat conservative. For example, the United States does not have anti-money laundering registration requirements for individual currency traders. Perhaps Taiwan will learn from foreign experiences and relax encryption regulations in the future, but for now, the standard is still Article 6 of the Money Laundering Prevention Act, which will be implemented on November 30th. Related reports: FSC confirms that VASP registration will be implemented earlier in December this year! Gu Ru-Jun worries that businesses may be caught off guard. Taiwan's encryption regulation enters the fast lane: Can VASP self-regulation break the deadlock? What are the advantages and risks? Taiwan's Money Laundering Prevention Act amendment preview: Encryption exchanges' 'dummy accounts' can be frozen! The 'End of Individual Currency Traders': Taiwan's new anti-money laundering regulations will be implemented on 11/30, and unregistered individuals will not be able to provide virtual asset services. This article was originally published on BlockTempo, the most influential blockchain news media in Taiwan.