Taiwan Special Law Public Hearing | MaiCoin: Suggests opening up perpetual contracts, grading management for operators

The Taiwan Financial Supervisory Commission convened a public hearing with Commissioner Luo Mingcai to gather the Financial Supervisory Commission, major virtual currency operators in Taiwan, and relevant experts and scholars to discuss the special law. MaiCoin's COO, Chen Minghui, presented opinions on the special law, including derivatives trading such as perpetual contracts not yet available in many countries, and the current challenges in cooperation between exchanges and banks.

Commissioner Luo Mingcai: The progress on the special law is too slow, with only six dedicated personnel at the Financial Supervisory Commission; there will be discussions on establishing a virtual asset management agency.

Gradual Introduction of Special Laws

MaiCoin's COO Chen Ming-hui advocates for a phased approach in introducing special laws, suggesting a classification and scope determination of businesses before the enactment of special laws. It is recommended that cryptocurrency exchanges or trading platforms focusing solely on spot trading adopt a registration system and implement a graded management system based on business scale.

Simplified Regulations: Trustee Elimination for Intermediaries

MaiCoin's COO Chen Ming-hui mentioned that intermediaries engaged in buying and selling can follow simplified regulations without the need for trustees, but they must adhere to cybersecurity management. Once the business reaches a certain scale, compliance with self-regulatory norms and guidelines is necessary.

Business Expansion to Derivatives for Increased Revenue

Chen Ming-hui of MaiCoin suggests that when special laws are enacted, the business scope should include derivatives, such as ETFs, binary options, and perpetual contracts. Clear criteria on business scale levels, capital requirements, and shareholder structure are essential for operators to thrive and grow in a compliant manner.

Regulation of Virtual Asset Operators by Specialized Agencies

She emphasizes a gradual approach in introducing regulation by specialized agencies to reduce communication costs and advocates for professional management when support measures are in place.

Enhancements Needed in Anti-Fraud and Joint Defense Mechanisms

While acknowledging the cooperation from the Financial Supervisory Commission and law enforcement in real-name verification and AML tracking, it is pointed out that relying solely on reports is insufficient. VASP operators and financial institutions are urged to enhance joint defense measures, including verifying the authenticity of account details and tracing fund flows more efficiently.

Furthermore, operators expect prompt responses from law enforcement after reporting risks, allowing for timely handling of cases. Establishing clear guidelines is recommended to enable operators to explain to customers the reasons for fund freezes and reduce customer complaints.

Anti-Fraud Measures Call for Improved Communication among Stakeholders

Concrete operational suggestions on how operators can collaborate with financial institutions and law enforcement agencies after identifying issues were proposed. Efficient anti-fraud measures are believed to hinge on joint defense and communication among financial institutions, law enforcement, and operators.

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