Title: Is Taiwan Considering Opening Up to Bitcoin ETFs?
After gaining approval in the United States, Bitcoin ETFs quickly became a popular investment option. Within a week of its launch, the Bitcoin spot ETF surpassed the Silver ETF in terms of assets under management, becoming the second-largest commodity ETF by asset size. This clearly demonstrates the market’s high interest in virtual assets.
However, due to the significant price volatility and high risks associated with cryptocurrency products, Taiwanese authorities have been cautious about allowing local investors to purchase Bitcoin spot ETFs through complex delegation. Their primary concern is protecting the interests of investors.
With the new cabinet taking office after May 20th, the newly appointed Chairman of the Financial Supervisory Commission (FSC), Peng Chun-lung, revealed during a legislative session on May 22nd that the Securities and Futures Institute had submitted a proposal on April 22nd. The proposal aims to open up complex delegation purchases under two conditions.
According to Peng Chun-lung, when looking at the international landscape, South Korea and Japan have not yet opened up to Bitcoin ETFs, while Singapore, Hong Kong, and Thailand have allowed conditional access. Taking these international experiences into account, the Securities and Futures Institute suggested that Taiwan consider opening up, but with two prerequisites:
1. Initially, complex delegation should be limited to professional investors, including corporations or individuals with assets exceeding NT$30 million, rather than being directly available to the general public.
2. Investors must sign a risk disclosure statement before engaging in complex delegation.
However, the exact timeline for opening up complex delegation for Bitcoin spot ETFs is expected to be decided by the end of this year.
Legislator Ke Ju-chun: Opening up to the general public is also necessary
Chang Chen-shan, Director-General of the Securities and Futures Bureau at the FSC, stated that since Bitcoin is not a security, mutual funds cannot issue Bitcoin ETFs. Nevertheless, many industry players are striving to introduce foreign Bitcoin ETF products into Taiwan.
Legislator Ke Ju-chun also urged the FSC to consider opening up Bitcoin spot ETFs to the general public in addition to corporations. In March of this year, Ke Ju-chun raised the issue during a questioning session with Minister Huang Tien-mu, stating that without an official process and method for complex delegation purchases, many individuals interested in buying Bitcoin ETFs would resort to using overseas brokers.
This approach not only makes it more difficult for the government to monitor investments in Bitcoin ETFs but also reduces brokerage firms’ fee income. When individuals encounter investment disputes with overseas brokers, they have to bear the risks themselves, and there is a possibility of falling into scams without any protection. This creates a situation where the government, brokerage firms, and individuals all lose out.
Regarding whether Taiwan truly has a chance to open up to Bitcoin ETF products, the FSC has stated that they have requested the Investment Trust and Consulting Association to conduct research. They anticipate that a clear policy will be discussed and established before the end of this year.