Taiwan’s “Crypto Congressman” renewed his drive for more controlled regulations around the technology by recommending new laws for token transactions.
On Friday, Taiwanese lawmaker Jason Hsu published a draft of policy recommendations intended at assisting cryptocurrency startups, including one that would examine the Ministry of Economic Affairs’ (MOEA) ability to create a new business division, as well as fresh legal structures for security tokens.
Hsu also beckoned for the Taiwanese legislature’s Finance Committee to dispense guidelines for initial coin offerings (ICOs) with a centre on user security.
His proposal comes just days after the nation’s financial regulator announced it would set up ICO regulations within the next eight months.
The Taipei Times published last week that Financial Supervisory Commission chairman Wellington Koo has told the council that “national standards” for how ICOs should be handled would be concluded by June of next year.
He stated that these measures would likely describe how tokens may be listed as securities, but clearly added that cryptocurrencies being utilised to acquire goods or act in a fashion separate to securities offering would not come under the new laws.
Hsu’s recommended structure would go farther, requiring the MOEA to form new consumer security and tax guidelines, according to Friday’s press release.
He also recommended a particular proposal for security token offerings (STOs) based around the French Commercial Growth and Transformation Act and the U.S. Howey Test.
If approved into law, his plan would define which token sales would come under the nation’s Securities and Exchange Act. STOs could also fall under equity crowd-funding rules and related laws, Hsu’s release noted.
Taiwan’s monetary watchdog has been pushing aggressively over the last 6 months for the active drafting of regulations. The proposal was generated to help the country fight illegal ICOs and prevent crypto related financial scams and embezzlement.
The Central Bank of Taiwan said that blockchain technology is still at the initial stage and is expanding swiftly, and it increased on its commitment to widening efforts for conducting more testing with financial institutions. Yang previously pledged to boost blockchain adoption in Taiwan through his February introduction speech.
Colluding on the effort are individuals involved in academics and the Taiwan Clearing House (TWNCH), an executive body that manages fiscal product compensations and decisions among financial organisations, under the supervision of the central bank.
However, primary outcomes imply that the distributed system, so far, is not as powerful as the current centralized Automated Clearing House (ACH) system, developed by the TWNCH.
While with two separate tests using the blockchain, PoC was able to process 4 and 26 transactions per second respectively, significantly lesser than the 2,700 transactions per second achieved by the ACH system.
Earlier this year, Taiwan’s Finance Minister Sheu Yu-jer, pronounced his theory that cryptocurrencies – which are employed as virtual assets – should be taxed in Taiwan, reckoning that the organisation is currently examining how to execute relevant taxation laws.
Yang’s remarks also come at a time when other important Asian states have already proposed to monitor cryptocurrencies under anti-money laundering rules to prevent financial offences.
As the possibilities behind the diverse utilisation of ledger based services are being explored, researched and developed, the central watchdog is keeping a stern eye on the outcome so as to include digital assets into a centrally regulated format for safety measures. The government is also inviting solution providers and blockchain developers to the island nation to showcase implementation strategies for the cohesive usage of ledger based technologies for Finance, Manufacturing, Public Transportation and even Renewable Energy.
The World Blockchain Summit in New Taipei City is gathering some of the biggest names, like John McAfee and Vit Jedlicka (President of Liberland), from the blockchain universe to the island nation to help the local government understand, develop and deploy ledger based services into its local industries.