The Financial Supervisory Commission (FSC) is drawing up national standards for initial coin offerings (ICOs) to make virtual tokens as easy to invest in as stocks and just as liquid, FSC Chairman Wellington Koo (顧立雄) said yesterday.
The draft is to be completed by June next year, he told a meeting of the Legislative Yuan’s Finance Committee.
Koo made the remarks after Chinese Nationalist Party (KMT) Legislator William Tseng (曾銘宗) said at a question-and-answer session on whether the government would regulate ICOs.
To conduct an ICO, businesses typically post a white paper on the Internet that outlines their ideas on token use, issue requirements and expected growth before offering virtual tokens for sale.
However, 127 white papers worldwide were found last year to have been faked and as of April, 80 papers were found to be inaccurate, Tseng said. Citing data from ICO advisory firm Satis Group, Tseng said that 81 percent of ICOs have been identified as scams.
The commission would regulate ICOs, Koo said, but added that tokens exchanged for goods, such as those used in accruing points at convenience stores or mileage points accepted by airlines, would not be covered by the standards.
“The more we regulate, the more this new economic behavior wanes,” Koo said.
The commission has no intention of curbing the creativity and productivity associated with cryptocurrencies if they are not used as securities, he said.
“People often confuse an ICO with the trading of cryptocurrencies,” Securities and Futures Bureau Deputy Director-General Tsai Li-ling (蔡麗玲) said by telephone.
An ICO is a type of public fundraising activity, whereas cryptocurrency trading is similar to trading in gold, for which the commission only implements money laundering controls, Tsai said.
If the token in an ICO functioned similar to a security, the commission would define it as a “securities token” and subject it to the Securities and Exchange Act (證交法), Tsai said.
The issuer would also need to disclose information similar to what companies that are publicly traded need to do now, she said.
However, without referencing the standards of other countries, it would be difficult to draft standards for ICOs, Tsai said.
The government tends to regard cryptocurrencies as virtue commodities or assets rather than currencies, because they have no intrinsic value, central bank Governor Yang Chin-long (楊金龍) told the committee, explaining why the commission should be responsible for regulating ICOs.
The commission said it has helped prosecutors investigate three cases of suspected ICO fraud.
One of the cases involved a private company advertising that coins could be exchanged for equities, which might have violated the Securities and Exchange Act and the Banking Act (銀行法), the commission said.
RESTRUCTURING: Taichung and Taoyuan profited most from local firms moving back high-end manufacturing amid the US-China decoupling of trade ties, the ministry said The government’s “Invest in Taiwan” initiative might this year see NT$627.1 billion (US$21.7 billion) of investment pledges realized, with several firms raising stakes and two dropouts due to customer losses, Minister of Economic Affairs (MOEA) Wang Mei-hua (王美花) said yesterday. Wang made the statement at the monthly meeting of the Third Wednesday Club, a local trade group featuring the top 100 firms of each business sector. Since early last year, the government has launched three programs intended to help local companies grapple with US-China trade rows and the COVID-19 pandemic, mainly through moving production lines back to Taiwan. Thus far, the ministry
JOBS AT RISK? Most Cathay Dragon routes are to be operated by Cathay Pacific or a subsidiary, but it was unclear how Taiwanese workers would be affected Cathay Pacific Airways Ltd (國泰航空) yesterday said it is planning new flight services for Taiwan as it announced a corporate restructuring that included the shutdown of its regional subsidiary, Cathay Dragon (國泰港龍), and could lead to job cuts in Taiwan. Cathay Pacific said the shutdown means that the one round-trip service between Taichung and Hong Kong per day and seven round-trip services between Kaohsiung and Hong Kong operated by Cathay Dragon prior to the COVID-19 pandemic would be terminated. “The parent company is planning a new schedule between Taiwan and Hong Kong,” Cathay Pacific assistant manager for corporate communications Moses Hou (侯恩錫)
OVERHEATED MARKET?: The gauge would be designed to provide more reliable information than private-sector data, and help improve policymaking, the council said The National Development Council (NDC) is considering creating a business climate index on Taiwan’s property market, allowing policymakers to better monitor market movements and intervene if necessary, NDC Minister Kung Ming-hsin (龔明鑫) said yesterday. Kung made the remarks at a meeting of the legislature’s Economic Committee where lawmakers from across party lines voiced concerns about housing price hikes driven by capital repatriation. Kung said that the council is assessing the possibility of creating an index designed to provide more accountable and transparent information than data provided by private-sector market analysts, and could help improve policymaking. The council would compile a report on
STOCK MARKETS TAIEX closes slightly higher The TAIEX closed slightly higher yesterday as market sentiment remained cautious over the Nov. 3 US presidential election. Contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) was again the anchor stabilizing the broader market, preventing the main board from falling into negative territory at the end of the session, dealers said. The TAIEX closed up 14.88 points, or 0.12 percent, at 12,877.25, on turnover of NT$167.982 billion (US$5.81 billion). TSMC, the most heavily weighted stock on the local market, rose 0.44 percent after fluctuating between NT$451 and NT$456. The semiconductor subindex and the bellwether electronics sector
RSS