Early Implementation of Exchange Registration System Why the Rush and Potential Implications

What happened?
Chen Shizhong, Chairman of the Financial Supervisory Commission (FSC), confirmed during his appearance at the Legislative Yuan’s Finance Committee yesterday (24th) that the “Registration System for Cryptocurrency Exchange Operators,” originally scheduled to be implemented on January 1, 2025, will be launched one month earlier.
Even if operators are already on the list of compliant statements, they must re-register. After the registration system is officially implemented, operators will have three months to complete the registration, and the system will be fully enforced nine months after registration.
At the same time, the FSC has proposed five major plans and 16 specific strategies to promote Taiwan as the asset management center of Asia, hoping to make the overall system changes felt by all sectors within two years.
Will the registration system be launched earlier?
Legislator Ke Ju-chun launched an inquiry to Chen Shizhong, Chairman of the FSC, yesterday (24th), and raised questions about the registration system for Virtual Asset Service Providers (VASP).
According to the draft amendment to the Anti-Money Laundering Act, the original compliance statement was supposed to be replaced by the “registration system” on January 1, 2025. However, there are rumors that the Executive Yuan, under pressure, may implement it earlier on December 1, 2023.
Ke Ju-chun pointed out that this early change would have a huge impact on VASP operators, especially as the shift from the compliance statement system to the registration system means that operators who fail to comply will no longer only face administrative penalties but also potential criminal liability. This is a significant change.
Ke Ju-chun also expressed during the inquiry that operators are generally willing to cooperate with the government but hope to have sufficient preparation time to ensure the smooth implementation of the new law. He further pointed out that if the government constantly changes its policies, operators will find it difficult to trust the government, which will then affect public trust and be extremely detrimental to the development of emerging industries.
FSC Chairman’s response: The necessity of the early revision
In response to Legislator Ke Ju-chun’s questioning, FSC Chairman Chen Shizhong responded that the early implementation of the registration system is mainly in response to the urgent need to combat fraud in society and not due to pressure from the Executive Yuan. The most important thing is to enable anti-fraud laws to take effect more quickly and protect the rights and interests of the people.
However, the end of the year is the busiest period for operators, especially with complex statutory procedures such as requiring certified public accountants’ verification. Implementing the new system abruptly may lead to operational difficulties and the exodus of operators. Ke Ju-chun is concerned that if the early implementation goes ahead, it may result in a “lose-lose” situation for both operators and the government, further affecting overall trust.
In response, Chen Shizhong stated that after the registration system is officially launched, operators will have three months to complete the registration, and the system will be fully enforced nine months after registration, minimizing the impact of the new policy on operators.
Taiwan’s next step: Becoming the Asian Asset Management Center
In addition to regulating VASP operators, the FSC is actively promoting Taiwan as the Asian Asset Management Center.
During Chen Shizhong’s appearance at the Legislative Yuan’s Finance Committee yesterday, the specific plan to “promote Taiwan as the Asian Asset Management Center” was officially announced. The aim is to make the overall system changes felt by all sectors within two years and to loosen more than 50 regulatory orders under the FSC’s supervision.
This includes strengthening the asset management plan, promoting inclusive sustainable integration, promoting wealth management, promoting investment in public construction, expanding investments in Taiwan, and five major plans and 16 specific strategies. By loosening policies and providing incentives, the aim is to attract domestic and foreign funds to enter Taiwan, laying a solid foundation for future financial development.
Chen Shizhong also further pointed out that the FSC hopes that within two years, Taiwan’s asset management scale can increase by NT$5 to 6 trillion, increase by NT$10 to 12 trillion in four years, and increase by US$1 trillion in six years, while also declaring the slogan “Feel changes in two years, see transformations in four years, and achieve success in six years.”