Taiwan forbids anonymous transactions on cryptos

In many countries, cryptocurrencies are still considered as a serious security issue. Not being able to trace transactions creates some serious problems for governments to identify any money laundering schemes happening within the borders. Almost every country has at least some form of regulations, but almost none of them feature a mandatory display of transactions.

Spain was the first to announce that it will forbid any more anonymous transactions happening within the borders in hopes of identifying any kinds of crimes. It looks like the idea resonated very well with the East Asian countries. The strongest effect was made on Taiwan, given the fact that they are about to implement the very same policy.

Taiwan trying to be more Western

The government was quick on its feet when it introduced the new law. Basically what will happen is that anytime you make a crypto transaction based on your account in one of the banks of Taiwan, it will immediately be blocked for being anonymous. The reason behind it is to start easily identifying any types of money laundering schemes and financing terrorism. Fines have already been introduced to the country. If you are seen making an anonymous transaction you could face up to 50,000 yuan ($1600) in fines if you are a non-financial enterprise. For financial institutions, the fine is 10 times the amount, 500,000 yuan ($16000).

Taiwan has been trying to showcase their developments in democracy and western style governments. The reason being to appear better than their socialist counterparts residing in mainland China. Therefore, they are involved in multiple international organizations, to which they are sometimes accountable, and this year is no different. The Asia/Pacific Group on Money Laundering (APG) will be conducting an evaluation of the country in November, thus the scramble for a new policy and improvement.

Blockchain and Taiwan

Blockchain and everything crypto had a comfortable house in Taiwan. Even in December 2017 when the crypto craze was in full swing, the government passed a new law, which allowed crypto businesses to sign up for an exemption from some of the financial laws of the country. Even after this massive boon, the central bank decided to move towards a blockchain based internal system for itself.

Taiwan’s capital, Taipei has been the center of Blockchain activity numerous times, most notably this July when a Blockchain Summit was conducted. On the summit, promises were made that the development of blockchain tech will be supported and encouraged by the government. All of this translated into Microsoft Taiwan accepting blockchain as its primary product for services. But there was still a long way to go as making an official bank account in the country was quite hard and at this point, it has become pointless.

Some experts are scared that Taiwan is going down the road of mainland China, their biggest rivals. According to talks on EspacioBit, just like Spain, Taiwan is about to take away the one defining attribute of cryptos that make them what they are. Critics are afraid that this may become an unhealthy practice everywhere, ultimately devaluing cryptos to the ground.

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Konstantin Rabin

About the Author: Konstantin Rabin

Konstantin has been working in the financial services industry since 2011. He is over-viewing various updates in the technology, regulation, and market movements. He's passionate about games and has a cute cat named Dog.

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