Taiwan’s Financial Supervisory Commission (FSC), has taken steps to ban credit cards from purchasing. cryptocurrencies.
As per reports According to local media, earlier this month the FSC sent a letter to the local bank association informing credit card operators that they should cut all ties with crypto companies.
FSC says credit cards are payment instruments for consumer goods, and should not be used to finance speculative trading. Credit cards are not allowed to be used for online gambling, futures and options trading and other related transactions.
The regulators gave credit card companies three month notice to comply with the directive. The regulator’s audit team will continue to monitor compliance levels after the end of the three-month period. The boom in crypto-related activity in Taiwan was triggered by the China blanket ban. NFTs are attracting a greater interest. Many in the sector proclaimed it to be the next crypto hub, but this is now overshadowed.
Since the Chinese ban in 2020, the FSC has been vocal about the sector’s emergence. Multiple press releases by the regulator have stressed the volatility of digital assets as well as the risks associated with them.
The crypto space in Taiwan is not yet fully regulated. The East Asian country also adopted rules against money launderingAML) schemes in 2021. The crypto regulations have been tightened by regulators all over the globe in light of the Terra-Luna crash and the loss of billions of dollars in the market.
Many countries have tightened regulation of the sector through licensing mandates, while others have banned crypto payments.
Taiwan is working on its CBDC
Taiwan is creating its own Central Bank Digital Currency to counter its rigid position on digital assets. The pilot trial is over and preparations are underway for the launch.
Apex Bank in Taiwan has been working on CBDC cases for over two years. However, it still faces some hurdles before becoming operational.
It will be possible for citizens to make payments without having to use a credit or debit card once the digital currency is launched.