stable coins
By Dan Saada
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What the Law Actually Requires. Stablecoin issuers must keep reserves fully backed and hold those assets in trust at domestic…
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Banks Win, Crypto Firms Scramble. The structural advantages for banks here are pretty obvious. They already hold trust licenses.
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Penalties Are Severe — and Specific. Non-compliance isn't just a licensing problem. The penalties are sharp.
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Taiwan passed a sweeping crypto law on June 30. The Virtual Asset Service Act doesn't just regulate stablecoins — it basically hands the market to banks and makes life very hard…
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The law sets full reserve requirements, mandatory audits, asset segregation inside domestic financial institutions, and a flat ban on paying yields to stablecoin holders.
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The Financial Supervisory Commission, known as the FSC, handles approvals. Secondary rules — the finer details on issuer eligibility and exactly how reserve management works —…
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Current virtual asset service providers that already hold AML registration get some breathing room.
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The structural advantages for banks here are pretty obvious. They already hold trust licenses. They already manage reserves. They already deal with regulators daily.
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Nonbank issuers can still compete — the law doesn't ban them outright. But they'd need to meet the same reserve and audit obligations as a regulated financial institution.
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Related: JPMorgan Flags Loophole Risk as Senate Races CLARITY Act Toward July Vote
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Taiwan's stablecoin market sits within a global sector valued at roughly $292.38 billion. The law's approach sets a clear precedent: regulated custodians and trust companies gain…
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Illegal operations or unauthorized stablecoin issuance can bring imprisonment of up to seven years and fines reaching NT$100 million. That's not a slap on the wrist.
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Those numbers are worth sitting with. A fine ceiling of NT$200 million for market manipulation puts this law in serious regulatory territory.
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The broader framework builds on Taiwan's existing AML registration system for virtual asset service providers.
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Related: Republican Senators Target Foreign AI Threats With New Security Bill After GENIUS Act
The Currency Analytics
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