The Financial Supervisory Commission on Monday reiterated a plan to limit fundraising through securities token offerings (STOs) to NT$30 million (US$971,691), despite a lawmaker’s proposal to raise the limit to NT$150 million.
Firms targeting higher funds would need to apply with the commission to run experiments in a regulatory sandbox, the agency said.
Although the commission said that it decided to set the limit to reduce risk, as STOs are new to investors in Taiwan, Chinese Nationalist Party (KMT) Legislator Jason Hsu (許毓仁) said that NT$30 million is not enough for start-ups, which usually need at least US$3 million.
The Taipei Exchange allows firms to raise up to NT$30 million through the Go Incubation Board for Startup and Acceleration Firms (GISA), but few companies have registered on the government-backed platform, Hsu said.
“It is difficult to believe that STOs will thrive if the regulations applied to them are similar to GISA,” Hsu told the Taipei Times by telephone.
Although the commission allows sandbox experiments, it would be inefficient, as the commission tends to spend four to six months counseling the applicants, Hsu said, citing Maicoin (現代財富科技), which last year expressed interest in conducting a sandbox experiment, but is still at the counseling stage.
“Foreign investors are more interested in STOs, but I wonder whether they will be happy with Taiwan’s regulations,” Hsu said.
The commission said that it has no plan to change its stance on the fundraising threshold, although STOs would be exempted from some administrative requirements.
“Usually, only listed firms can raise public funding, but we allow start-ups to raise money through STOs,” Securities and Futures Bureau Deputy Director-General Tsai Li-ling (蔡麗玲) told the Taipei Times.
The commission would first allow institutional investors to invest in securities tokens, as retail investors have lower ability to take risks, Tsai added.
Hsu said that he hopes the commission would reference other countries, such as Japan, which allows retail investors to invest up to US$20,000 in STOs per year.
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