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Taiwan to Restrict Offshore Non-Complaint ExchangesTaiwan’s Financial Supervisory Commission (FSC) has been working towards taking proactive steps to regulate the cryptocurrency industry within its borders recently. One key guiding principle it has developed is to impose strict regulation on offshore crypto exchanges operating in Taiwan.Photo by Vas on UnsplashTen guiding principlesTaiwan’s Central News Agency reported on Thursday that in an effort to ensure compliance and protect consumers, the FSC has developed ten guiding principles for virtual asset service providers (VASPs). These principles are set to be officially released by the end of this month, according to a government official.The guiding principles will encompass several important aspects of the crypto industry. They will emphasize the need for enhanced information disclosure, requiring businesses to establish clear review standards for the listing and delisting of virtual assets. Additionally, there will be a focus on ensuring the separation and proper custody of assets belonging to both companies and customers.Focusing on offshore complianceThe FSC intends to make it clear that offshore crypto exchanges must adhere to proper compliance registration if they want to conduct business onshore. The move is in line with what appears to be a commitment by the Taiwanese authorities to promote responsible and secure cryptocurrency operations.One particularly significant restriction is the prohibition of illegal solicitation of business by foreign crypto firms. The FSC is determined to enforce this rule strictly. Foreign VASPs that fail to register according to company law and declare their compliance with anti-money laundering regulations to the FSC will be barred from soliciting business in Taiwan or catering to domestic residents.It’s worth noting that Taiwan has been proactive in implementing anti-money laundering laws for VASPs since July 2021. Although this particular measure has been in place, the cryptocurrency industry in Taiwan has largely operated in a regulatory vacuum. However, recent developments suggest a shift towards greater oversight and accountability.One notable example is Binance, the world’s largest cryptocurrency exchange, which has initiated the process of registering for anti-money laundering compliance in Taiwan. Despite not being fully regulated in the country, Binance has established a local entity, “Binance International Limited Taiwan Branch (Seychelles),” and received government approval for company registration.Building a regulatory frameworkIn addition to these regulatory efforts, the Ministry of Economic Affairs has proposed the creation of a new business category within relevant regulations. This move aims to facilitate the formation of cryptocurrency-related industry associations, encouraging the development of self-regulatory guidelines.The forthcoming guiding principles for VASPs are expected to provide much-needed clarity and structure to the rapidly evolving world of cryptocurrencies within Taiwan’s borders.Many leading jurisdictions have been behind the curve in developing a clear, workable regulatory framework for crypto. That has led to many exchanges establishing themselves in offshore locations where light touch regulation is applied. It’s highly likely that the Taiwanese have examined the fallout from this development, best exemplified by the spectacular collapse of Bahamas-based FTX last November.

Study Places Hong Kong as Leader in Crypto ReadinessHong Kong, according to a recent study conducted by Forex Suggest, has emerged as the leading jurisdiction worldwide in terms of its readiness for cryptocurrencies. The study evaluated various factors such as the number of blockchain startups per 100,000 people and the density of crypto ATMs in relation to the population.Photo by Traxer on UnsplashZero capital gains taxThe attractiveness of Hong Kong for investors in the crypto space stems from its advantageous tax policies. The study noted that Hong Kong does not levy capital gains taxes on cryptocurrency, making it an appealing destination for crypto enthusiasts. The United States and Switzerland secured the second and third positions, respectively, in the rankings of the most crypto-ready countries.In recent times, Hong Kong has actively embraced investments from digital asset companies and is poised to implement new regulations for the industry. Effective from June 1, the city’s new rules aim to establish Hong Kong as a global hub for digital assets. These regulations permit licensed cryptocurrency trading platforms to offer services to retail investors while incorporating measures to safeguard individual traders.Global crypto firms are gearing up for that new licensing approach, carving out separate corporate entities in order to meet the regulatory requirements which the Hong Kong regulator, the Securities Futures Commission (SFC), has set. Another Hong Kong regulator, the Hong Kong Monetary Authority (HKMA), is also opening up to embrace digital asset innovation through a pilot project implicating the tokenization of real world assets.Regarding the number of blockchain startups, Hong Kong boasts three startups per 100,000 individuals, securing the second position globally. Topping the list is Switzerland, with an impressive count of 12.9 blockchain startups per 100,000 residents, amounting to a total of 1,128.The study also highlighted that countries such as Hong Kong, Switzerland, Panama, Portugal, Germany, Malaysia, and Turkey impose the lowest taxes on cryptocurrencies. These nations exempt individuals from capital gains taxes on profits derived from cryptocurrency trading.Crypto ATM proliferationWhen considering the prevalence of crypto ATMs, Hong Kong ranks third globally, with two ATMs per 100,000 people, totaling 149 ATMs. The United States takes the top spot with nearly 34,000 crypto ATMs, but when normalized to the population, it has 10.1 ATMs per 100,000 individuals.Regressive measures in USIn contrast to Hong Kong’s favorable environment, regulators in the United States have intensified their efforts to tighten regulations on cryptocurrency exchanges, leading many within the industry to advocate for clearer guidelines. Consequently, several exchanges are exploring jurisdictions that offer more favorable conditions.Forex Suggest emphasized that the report’s findings were based on extensive data analysis, taking into account factors such as tax regulations, legislation, the presence of blockchain startups, and the level of interest in cryptocurrencies. Each jurisdiction received a normalized score out of 10 for each factor, and the overall rankings were determined by averaging these scores.Hong Kong’s position as the most crypto-ready jurisdiction in the world showcases its commitment to fostering innovation and becoming a global leader in the digital asset space. With its advantageous tax policies, growing number of blockchain startups, and forthcoming regulations, the autonomous Chinese territory is solidifying its position as an attractive destination for businesses and investors in the cryptocurrency space.

GSR Gets on Path Towards Full Regulatory Approval in SingaporeGSR Markets Pte. Ltd., the Singaporean subsidiary of the global crypto trading firm GSR, has reached a significant milestone in its quest to become a fully licensed entity within the city-state. On Monday, the Monetary Authority of Singapore (MAS) granted GSR in-principle approval for a Major Payment Institution (MPI) license.Photo by Mike Enerio on UnsplashTrading licenses filtering throughThis development mirrors similar approvals granted to other crypto firms in the region, solidifying Singapore’s status as a hub for crypto and Web3 innovations. The approval of GSR’s MPI license follows hot on the heels of Coinbase Singapore’s announcement of securing a full Major Payment Institution license from MAS.Other companies such as Circle, Blockchain.com, and Crypto.com have also obtained MPI licenses this year. These developments underscore the competitive yet regulated landscape of the cryptocurrency market in Singapore.In-principle approvalThe in-principle approval from MAS empowers GSR to provide crypto and fiat-related services to Singaporean residents and entities. This includes the ability to conduct payment services without the limitations of single transaction thresholds (SGD 3 million) and monthly limits (SGD 6 million). GSR’s CEO, Jakob Palmstierna, expressed gratitude for MAS’s constructive oversight, which has played a pivotal role in shaping the evolving digital asset landscape in Singapore. Palmstierna stated:“We are immensely grateful to MAS for their constructive oversight, which helps shape a growing digital asset ecosystem that we feel proud to be a substantial part of.”Meanwhile, GSR’s COO Xin Song, emphasized the importance of this approval, stating that it enables them to “deepen our local client partnerships and continue in our critical role as a liquidity provider within the ecosystem.”GSR’s presence in Singapore aligns with the country’s burgeoning crypto-friendly environment. Recent surveys indicate that 25% of Singaporeans view cryptocurrency as the future of finance, with 32% having some involvement in crypto ownership. Moreover, Singapore boasts over 700 Web3 companies, positioning itself as a pivotal market for the expansion of the crypto and Web3 economy.Company ambitionsGSR, established in 2013 in New Jersey, offers a diverse range of services, including over-the-counter crypto trading, derivatives trading, market making, and venture capital investments. The firm is no stranger to regulatory compliance, holding Money Service Business licenses across several US states.The company was founded by former Goldman Sachs Executives Rich Rosenblum and Cristian Gil. At the height of the last crypto bull run, the crypto market maker had plans “to add 100 hires every six months for the next few years.” No doubt that ambition has been scaled back since then, given the protracted bear market which has followed.Last month, Gil became embroiled in a spat with Andrei Grachev of rival market making firm, Singapore-based DWF Labs.GSR’s recent attainment of in-principle approval for a Major Payment Institution license from MAS reinforces Singapore’s position as a leader in the crypto space. The firm’s interest in pursuing a compliant route forward and its role as a liquidity provider bode well for both GSR and the broader crypto community in the Asia-Pacific region.