MaiCoin founder Alex Liu calls for collaboration between local and overseas entities to promote the trading of derivative products related to virtual currencies in Taiwan.

With the rapid development of Taiwan's virtual currency industry, the challenges and opportunities faced by the government and industry players are increasing. Terry Lin, founder and CEO of MaiCoin Group, emphasized in Wealth Magazine that in order to enhance the international competitiveness of Taiwan's virtual currency market, it is important to promote cooperation between local and overseas operators, and gradually open up local operators to provide derivative trading services.

Loss of Market Competitiveness Despite Legal Compliance

Liu Shiwei pointed out that according to the "Guidelines for the Management of Virtual Asset Platform and VASP Business," virtual currency operators in Taiwan are currently not allowed to provide derivative products or stablecoin services. However, overseas operators can continue to offer these services, giving them an advantage in attracting domestic investors and creating an unfair competitive environment for local operators.

The Taiwan Virtual Currency Association is established! BitAsset serves as chairman, XREX as vice chairman, and Rybit as executive director.

Promoting Cooperation between Local and Overseas Operators

Liu Shiwei believes that in order to enhance the competitiveness of Taiwan's virtual currency industry, the government should consider opening up cooperation between local and overseas operators. This collaboration can introduce more international advanced experiences and technologies, promote innovation and development in the local market, and elevate Taiwan's position in the international virtual currency market.

Opening Derivative Product Trading Services

Liu Shiwei emphasized that the government should gradually allow local operators to provide derivative product trading services, such as ETFs, perpetual contracts, and binary options. This can not only meet the needs of domestic investors but also enhance the competitiveness of local operators, showcasing their strength in the international market. He pointed out that past events like the collapse of LUNA coin and the bankruptcy of FTX, while causing losses to investors, also serve as a reminder for the government and operators to pay more attention to risk management and compliance requirements in future development.

New Challenges and Opportunities in Government Regulation

Recently, the Executive Yuan passed the "Anti-Fraud New Four Laws," bringing virtual currency under regulatory supervision, imposing higher compliance requirements on domestic and foreign operators. According to the draft amendment of the "Anti-Money Laundering Act," whether domestic or foreign companies provide virtual currency services in the future, they must complete anti-money laundering prevention and service registration or filing with the central competent authority. Liu Shiwei stated that the introduction of these new regulations provides a more level playing field for local operators but also requires the government to strictly monitor the compliance behavior of foreign operators to protect the rights of domestic investors.

U.S.'s Most Compliant Exchange Coinbase Seeking Offshore Business

Not only Taiwanese operators, Coinbase, the largest cryptocurrency exchange in the United States, despite having a large customer base and multiple licenses in the U.S., still cannot trade derivative products. Compared to offshore exchanges where trading various derivative products and futures contracts are more freely permitted, there is a significant gap in trading volume.

After obtaining approval from the Bermuda Monetary Authority, Coinbase launched an offshore derivative exchange in Bermuda in April 2023, starting an international site to provide perpetual contracts for "non-U.S." institutional users.

As of the deadline, according to CoinMarketCap statistics, Coinbase's derivative trading volume ranks 52nd, still showing significant differences from mainstream derivative exchanges.

Coinbase Approved for Regulation, International Exchanges Can Provide Retail Perpetual Contract Trading

FTX Previously Challenged the Derivatives Market

The now bankrupt FTX exchange was quite active in lobbying the U.S. CFTC to open up derivative trading in 2022, integrating blockchain technology to provide an efficient trading platform for various commodities. However, these efforts ceased discussion with FTX's demise.

CFTC evaluates FTX US derivative trading, opens public comment period, Coinbase CEO supports: will leave a comment