According to local media, Taiwan’s financial watchdog has requested that local banks forbid card payments in cryptocurrency transactions. According to the authorities, these assets are risky, and the related financial flows are challenging to observe.
According to local sources, the FSC requested credit card firms cease processing payments for businesses involved in cryptocurrencies in a letter earlier this month that was addressed to Taiwan’s Association of Banks.
The regulator also wants card companies to halt processing payments for high-risk activities, including trading stocks, futures, options, and online gambling.
Key Highlights:
- Credit cards should not be used for payments related to gambling, stocks, futures, options, and other activities, according to Taiwan’s FSC.
- Taiwan’s credit card issuers have three months to change and follow the new law.
According to the FSC, credit cards should be used to pay for products and services rather than for speculative trading and financial activities.
According to the report, credit card companies that now provide services to cryptocurrency merchants have three months to meet the FSC’s requirements. After the cutoff, the businesses must provide the regulator with an audit report to demonstrate compliance.
Despite adopting new anti-money laundering (AML) guidelines for service providers in the market this summer, Taiwan’s crypto industry is still primarily uncontrolled. In addition, the nation still has to complete a project to launch the Central Bank Digital Currency (CBDC).
As part of continuous testing for the retail digital money prototype, the Taiwanese central bank performed several technical simulations in a closed-loop setting in June. However, the head of the monetary authority acknowledged that the bank might require an additional two years, or twice as long, to complete the work on the CBDC.
