According to local media, Taiwan’s financial regulator asked banks to not allow local cards for payment in transactions that involve cryptocurrencies. These assets can be risky, while cash flow associated with them is difficult to track.
Taiwanese Regulator Demands Banks to Not Allow Crypto-Related Pays with Bank Cards
Taiwan’s Financial Supervisory Commission (FSC) has told credit card issuers and banks to effectively prevent their customers from using credit cards as a payment instrument in transactions linked to cryptocurrencies, according to a report published by the business news portal UDN.
This watchdog cites the recent crypto market decline as well as persistent concerns about money laundering associated with virtual assets. It also refers to the fact that the virtual assets are highly volatile and highly speculative.
According to sources in financial services, the FSC had issued this call earlier in July in a written communication to the Bankers Association of Taiwan. This week the FSC did not deny the information nor comment initially. Forkast later received confirmation from the authority that it had instructed credit card agencies not certify crypto service providers merchants.
It was stressed that credit cards should be used for consumption, not financial investments or speculative trades. Card acquirers were given three months to conform with new rules. FSC reminds people of an earlier requirement which bans use credit cards for payments related to stock, futures and other options.
Taiwan’s crypto sector remains largely unregulated, despite the adoption of updated anti-money laundering (AML) rules for service providers in the market last summer. A project for a digital central bank currency (CBDC) is not yet completed.
As part of its ongoing tests for the prototype retail digital currency, Taiwan’s central bank conducted a number of simulations in closed-loop environments. However, the governor of the central bank acknowledged that it may take two more years for the CBDC to be completed. This is twice the time expected.
What do you think Taiwan might do to crypto-related transactions going forward? Comment below to let us know.
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