Taiwan bans crypto purchases with credit cards

Taiwan’s securities watchdog has implicitly banned credit card cryptocurrency transactions on the island nation.

The country’s Financial Supervisory Commission (FSC) issued a letter to the banking industry association earlier this month, asking them not to grant “buyer status” to virtual asset providers that serve credit card holders.

Details in the letter said digital assets are highly speculative and prices are often extremely volatile, local media reported. Furthermore, credit cards should not be used for payments related to gambling, shares, futures, options and other transactions.

The move follows strict anti-money laundering laws for cryptocurrency service providers that were passed in July last year.

Credit card issuers in Taiwan have been given three months to make adjustments and comply with the new law. When that time is up, an independent auditing unit will review compliance and report results to the FSC, which is effectively Taiwan’s equivalent of the Securities and Exchange Commission.

Cryptocurrency is tightly regulated in neighboring China, but lawmakers around the world have sought to speed up crypto oversight after the implosion of Terra’s algorithmic stablecoin in May sent cryptocurrency markets tumbling.

The UK recently introduced a new bill seeking to regulate stablecoins, and Russia has expanded its ban on crypto payments to specifically include security tokens, utility tokens and non-fungible tokens (NFTs).

Meanwhile, Taiwan’s central bank has been exploring an interest-free CBDC (central bank digital currency). CBDC is in its second phase of development and is currently being deployed in five selected Taiwanese banks.

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