The Financial Supervisory Commission (FSC) of Taiwan has announced the reauthorization allowing professional investors to invest in cryptocurrency exchange-traded funds (ETFs), including spot Bitcoin 
$98,421 ETFs. This development comes as Chinese legislative bodies cautiously propose a crypto transition in response to increasing market demands for spot Bitcoin ETFs.
New Regulations for Crypto ETFs
In its announcement, the FSC reported that it has begun consulting with the Securities Investment Business Association of the Republic of China to review the investment risks associated with foreign crypto ETFs. This decision aims to provide investors with a variety of product options and increase the reauthorization process for securities firms.
The Role of Professional Investors
The FSC suggests that professional investors should manage their investments in these high-risk ETFs through reauthorization. This move is seen as a significant step for the market, especially following Taiwan Mobile’s acquisition of a virtual asset service provider (VASP) license. A FSC official emphasized, “It is crucial for professional investors to manage these investments considering their level of knowledge and experience.”
Restrictions for Retail Investors
Initially, retail investors in Taiwan will not have access to cryptocurrency ETFs. Those allowed to invest will include institutional investors, high-net-worth entities, and individual investors with significant asset portfolios.
Securities firms must obtain board approval before accessing spot Bitcoin ETFs. Additionally, clients’ knowledge and experience regarding virtual assets will be assessed to facilitate their initial investments.
Before the first acquisition of a crypto ETF by non-institutional clients, a risk warning letter must be signed. Furthermore, securities firms are required to provide detailed product information about the ETFs and conduct regular training on virtual assets.
The Taiwan FSC will closely monitor the implementation of these measures, continuously improving regulations to enhance the competitiveness of securities firms while protecting investors.
Recent Developments and Demands
With increasing demand for spot Bitcoin ETFs in the United States, the announcement from Taiwan’s FSC may reflect this trend in Taiwan. Additionally, investors in China are turning to Bitcoin due to economic fragility, leading former Chinese Finance Minister Lou Jiwei to call for a closer examination of developments in the crypto sector. Jiwei stated, “Cryptocurrencies could have negative effects on global financial stability.”
These developments are viewed as part of Taiwan’s efforts to create a more regulated and secure environment in the cryptocurrency market.
The new decision by Taiwan’s FSC aims to make cryptocurrency investment more commonplace among professional investors. Investors will have the opportunity to operate in a more informed and protected environment while investing in such ETFs. Furthermore, this step could enhance Taiwan’s competitiveness in the international cryptocurrency market.
