Taiwan's FSC Unveils Detailed Crypto Regulatory Framework by Q1 2027

Taiwan's Financial Supervisory Commission (FSC) is drafting nine sets of supplementary regulations under the Virtual Asset Service Act, aiming to finalize them by Q1 2027. The Act itself was passed on June 30, 2026, and defines seven categories of licensed operations: exchanges, trading platforms, transfers, custody, underwriting, lending, and 'others'. Each business category requires its own separate license.

The FSC will be the sole regulator for all virtual asset service providers (VASPs), consolidating oversight that was previously more fragmented. The legislation represents a fundamental shift in how Taiwan handles crypto oversight, replacing a relatively lightweight anti-money laundering registration system with a full licensing regime.

Stablecoins are given granular treatment under the Act. Domestic stablecoin issuers must obtain FSC permission, peg their tokens to a fiat currency, and maintain 1:1 reserves held in segregated accounts at domestic financial institutions. Foreign-issued stablecoins like USDT and USDC receive different treatment, being classified as commodities rather than regulated stablecoins.

The penalties for skirting the rules are substantial. Operating without a license can result in up to seven years of imprisonment and fines reaching NT$100 million. Fraud carries even steeper consequences: three to ten years in prison and fines of up to NT$200 million.