FSC restricts access to virtual asset ETFs to professional institutional investors Securities companies must establish a “virtual asset ETF suitability system”
Taiwan's financial regulator allows professional investors to invest in “foreign virtual asset” exchange-traded funds (ETFs) through retrust services.
The Financial Supervisory Commission (FSC) said in a statement that the move will “give investors a wider range of product options and increase the momentum for Chinese securities companies to outsource their operations.”
Cryptocurrency-related ETFs involve high risks, so the FSC has restricted them to professional investors. These include professional institutional investors, high net worth professionals, and high net worth clients.
Additionally, the FSC noted that brokerages must establish “a virtual asset ETF suitability system that requires board approval to determine a customer's virtual asset expertise before investing in an ETF.” .
Brokers are also required to provide product information related to ETFs before customers make their first purchase. Security companies also provide regular training and education regarding virtual assets.
The Financial Supervisory Commission stated, “We will continue to pay close attention to how securities companies handle subcontracting operations, and will continue to develop related regulations in order to protect the rights and interests of investors and strengthen the competitiveness of securities companies.''
cautious approach
Taiwan has traditionally taken a cautious stance toward the cryptocurrency market.
But over the past year, financial regulators have seen a shift in the industry. Last September, the FSC announced guidelines for virtual currency exchanges with the aim of strengthening virtual currency regulations.
Then, in October last year, the Taiwanese government introduced a virtual asset management bill.
The bill provides guidelines for virtual asset service providers (VASPs) while promoting industry growth, focusing on customer protection, regulatory obligations, and industry self-regulation.
