Taiwan’s financial regulator has asked local banks not to allow the use of cards for payments in transactions involving cryptocurrencies, local media revealed. The authority maintains that these assets are risky while the associated cash flows are difficult to monitor.
Taiwan regulator urges banks not to allow crypto-related payments from bank cards
According to a report published by business news portal UDN, Taiwan’s Financial Supervisory Commission (FSC) has asked credit card issuers and banks to effectively prevent their customers from using credit cards as a payment instrument in transactions involving cryptocurrency. stop in a way.
The watchdog is citing the latest crypto market downturn, as well as persistent concerns over money laundering risks associated with virtual assets, which it also describes as highly speculative and extremely volatile.
Financial industry sources claim the FSC issued the call in a letter to the Bankers Association of Taiwan earlier in July. This week, the authority neither denied the news nor initially commented. Later, it confirmed to Forkast that it had asked credit card agencies not to sign crypto service providers as merchants.
The commission stressed that credit cards should serve as a payment instrument for consumption rather than a method for financial investment and speculative trading and gave card recipients three months to comply with the new rules. The FSC also reminded people about a pre-requisite that prohibits the use of credit cards in payment for transactions involving stocks, futures and options.
Despite the adoption of updated Anti-Money Laundering (AML) rules for service providers in the market last summer, Taiwan’s crypto sector remains largely unregulated. The country is yet to finalize a project to issue a central bank digital currency (CBDC).
In June, Taiwan’s central bank completed a series of technical simulations in a closed-loop environment as part of ongoing tests to prototype a retail digital currency. However, the governor of the Monetary Authority acknowledged that the bank may need two years to complete work on the CBDC, which is more than double the estimate.
Do you expect Taiwan to impose other restrictions on crypto-related transactions in the future? Let us know in the comments section below.
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