Taiwan Cryptocurrency Regulations: What You Need to Know in 2025

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Cryptocurrency has become one of the most talked-about investment vehicles in recent years. While many are drawn to its high-return potential, questions about legality, regulation, and risk remain top of mind—especially in Taiwan. Is cryptocurrency legal? What rules govern trading and investment? And how does the government protect investors from fraud and money laundering?

This guide breaks down Taiwan’s current cryptocurrency regulations, highlights key legal frameworks, and offers clarity on what both investors and businesses need to know in 2025.

What Is Cryptocurrency? Understanding the Basics and Risks

At its core, cryptocurrency is a digital or virtual form of currency that uses cryptography for security. Unlike traditional fiat money issued by governments—like the New Taiwan Dollar (TWD)—cryptocurrencies operate on decentralized networks based on blockchain technology. Popular examples include Bitcoin, Ethereum, and various utility or governance tokens.

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The Financial Supervisory Commission (FSC) of Taiwan has consistently classified cryptocurrencies not as legal tender but as highly speculative digital assets. This distinction is crucial: it means crypto isn’t backed by the government and carries no guarantee of value retention.

Because of their volatile nature, prices can swing dramatically within hours. For example, Bitcoin has seen swings of over 20% in a single day during market shocks. This volatility makes crypto an attractive yet risky investment—especially for beginners who may not fully understand market dynamics or technical analysis.

Moreover, the anonymity and borderless nature of blockchain transactions create opportunities for misuse, including scams, fraud, and illegal fund transfers. That’s why regulatory oversight is essential—not to stifle innovation, but to protect consumers and maintain financial stability.

Are Cryptocurrencies Legal in Taiwan?

Yes—cryptocurrency ownership and trading are legal in Taiwan, provided they comply with existing financial and anti-money laundering laws.

However, legality doesn’t mean unrestricted freedom. The government allows individuals to buy, sell, and hold digital assets through licensed platforms, but it does not recognize them as official currency. In fact, businesses are not obligated to accept crypto as payment.

The FSC has repeatedly emphasized that crypto investments should be approached with caution due to their speculative nature. There are no deposit insurance protections like those offered for bank accounts, meaning if a platform fails or gets hacked, investors may lose their funds permanently.

So while you won’t be breaking the law simply by investing in Ethereum or Solana, you must do so responsibly—and within the boundaries of Taiwan’s evolving regulatory framework.

Combating Crypto Fraud: Securities Laws and Criminal Penalties

One of the biggest concerns surrounding cryptocurrency is fraud—particularly through Initial Coin Offerings (ICOs). During the 2017 crypto boom, numerous projects raised millions from unsuspecting investors using misleading promises and unverified whitepapers.

Taiwan’s approach? Use existing laws to crack down on abuse.

If a token qualifies as a security under the Securities and Exchange Act—based on factors like profit expectations and centralized management—it must comply with disclosure requirements, registration rules, and investor protection standards. Failure to do so can result in:

Additionally, fraudulent activities such as fake ICOs or Ponzi schemes may fall under:

The penalties for illegal fundraising are especially severe:

These laws apply regardless of whether funds are collected in TWD or cryptocurrency. The message is clear: just because a project uses blockchain doesn’t mean it’s exempt from financial crime laws.

Fighting Money Laundering: How Taiwan Regulates Crypto Platforms

Due to its pseudonymous nature, cryptocurrency has long been associated with money laundering. To combat this, Taiwan aligned with international standards set by the Financial Action Task Force (FATF).

In late 2018, amendments to the Anti-Money Laundering Act officially brought virtual asset service providers (VASPs)—including exchanges and wallet services—under regulatory supervision.

Then in June 2021, the government enacted the Virtual Currency Platform and Transaction Business Anti-Money Laundering and Counter-Terrorist Financing Measures, requiring all crypto platforms to:

Failure to comply can lead to fines of up to NT$10 million.

These measures ensure greater transparency and accountability across the industry. While some users find KYC procedures inconvenient, they play a vital role in preventing criminal exploitation of digital assets.

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The Current State of Taiwan's Crypto Regulation

As of 2025, Taiwan’s regulatory focus remains centered on four key areas:

  1. Securities regulation – Ensuring token offerings don’t violate investment laws
  2. Anti-money laundering (AML) – Preventing illicit financial flows
  3. Fraud prevention – Enforcing criminal liability for scams
  4. Unauthorized fundraising – Cracking down on illegal deposit-taking

However, there are still significant gaps—especially regarding emerging technologies like:

Unlike centralized exchanges, DeFi platforms operate without intermediaries, making traditional oversight difficult. Similarly, NFTs blur the line between art, collectibles, and securities—posing challenges for classification and taxation.

Currently, there is no dedicated crypto-specific legislation in Taiwan. Instead, regulators rely on case-by-case interpretations and existing legal frameworks. Over time, we expect more formal guidance from the FSC and court rulings to clarify these gray areas.

Frequently Asked Questions (FAQ)

Q1: Is buying cryptocurrency legal in Taiwan?

Yes. Individuals can legally buy, sell, and hold cryptocurrencies through compliant platforms. However, crypto is treated as a digital asset—not legal tender.

Q2: Are crypto exchanges regulated in Taiwan?

Yes. All virtual asset service providers must follow AML/CFT (Anti-Money Laundering and Countering the Financing of Terrorism) rules and submit compliance declarations to the FSC.

Q3: Can I get taxed on crypto gains in Taiwan?

While there is no specific crypto capital gains tax yet, profits may be subject to income tax depending on trading frequency and intent (e.g., day trading vs long-term holding).

Q4: What happens if a crypto exchange gets hacked?

Investors bear the risk unless the platform offers insurance or compensation. Always choose platforms with strong security practices.

Q5: Are ICOs banned in Taiwan?

No, but if an ICO involves securities, it must follow the Securities and Exchange Act. Unregistered securities offerings can lead to criminal charges.

Q6: How do I stay safe when investing in crypto?

Use regulated exchanges, enable two-factor authentication (2FA), avoid sharing private keys, and never invest more than you can afford to lose.

Looking Ahead: The Future of Crypto Regulation in Taiwan

While Taiwan has made solid progress in regulating cryptocurrency risks, much work remains. As decentralized applications grow in popularity, regulators will need to adapt quickly—balancing innovation with investor protection.

We may see future developments such as:

For now, investors should stay informed, choose compliant platforms carefully, and understand that while cryptocurrency is legal—it's also largely buyer beware.

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By understanding Taiwan’s current regulatory landscape, you can navigate the crypto space more confidently—and safely—in 2025 and beyond.