Taiwan's Regulators Considering Allowing Convenience Stores to Facilitate Crypto to Cash Transactions

  • Cryptocurrency to cash transactions might be approved in Taiwan, according to regulators.
  • Taiwanese lawmakers are evaluating the risks associated with such services and will submit update crypto regulations next month.

Taiwan’s financial regulator, the Financial Supervisory Commission (FSC), is reportedly considering to allow convenience stores in the country to conduct cash transactions involving cryptocurrencies.

FSC chairman, Wellington Koo, recommended on Thursday that digital currency-related cash transactions be allowed “under daily limits.” Local crypto firms have advised that the maximum daily limit be “set at NT $100,000 (3,260 USD) to NT $20,000 (652 USD).”

Daily Limits On Cash Transactions

According to Koo, cash transactions with cryptocurrencies seldom “exceed NT $10,000”, or $350. However, before possibly permitting local merchants to facilitate crypto-to-fiat transactions, the commission is looking for ways to effectively monitor them in order to prevent their use in illicit activities.

As many regulatory authorities have warned, Koo cited concerns about the the use of pseudonymous cryptocurrencies in money laundering. In order to help prevent illicit activities carried out using digital currencies, the FSC instructed Taiwanese (officially the Republic of China) financial institutions in July to open bank accounts for crypto traders.

This requirement would then make it compulsory for local crypto investors to disclose their real name and other information related to AML/KYC checks. Koo said most crypto-related businesses in Taiwan have been supportive and are ready to comply with regulatory policies and requirements to prevent unlawful activities.

According to the Taipei Times, the FSC recently requested the Bankers Association of the Republic of China, a consortium of 62 commercial banks and financial holding companies, to formulate self-regulatory processes and “risk-control measures” for crypto assets.

Cryptocurrencies Will "Not Retain Value"

Sherri Chuang, the deputy director-general of Taiwan’s Banking Bureau, said that updated cryptocurrency regulations would be drafted and put in place next month. Chuang also recommended that local digital asset trading desks work closely with banks.

She noted that if a crypto transaction exceeds a daily limit of NT $100,000, then the company facilitating the exchange must refund the extra amount.

In August, CryptoGlobe reported that Taiwan’s central bank governor, Yang Chin-long, said cryptocurrencies do not have the “trust element” that fiat currencies have and they might collapse.

Ching-long explained that if a currency lacks the trust element, then it will not be able to retain value and cannot function effectively as a medium of exchange - a view shared by giant Wall Street investment bank Goldman Sachs.

Wells Fargo Launches Its Own 'Digital Cash', Claims It's Not a Cryptocurrency

Financial services giant Wells Fargo has announced the launch of a settlement service called “Wells Fargo Digital Cash,” which will run on its distributed ledger technology platform.

According to the company’s announcement, Wells Fargo Digital Cash is a service that’ll bring in operational efficiencies as it’ll remove “barriers to real-time financial interactions” across its own network. The Digital Cash will “complete internal book transfer of cross-border payments” and its concept has already successfully been proven.

Lisa Frazier, head of the Innovation Group at Wells Fargo, was quoted as saying:

  • We believe DLT holds promise for a variety of use cases (…) Wells Fargo Digital Cash has the potential to enable Wells Fargo to remove barriers to real-time financial interactions across multiple accounts in multiple marketplaces around the world.

Speaking to The Block a Wells Fargo representative reportedly clartified that Wells Fargo Digital Cash is “not a cryptocurrency” before adding it is “1:1 against a tokenized USD/fiat currency that runs on a distributed ledger rail.”

When asked whether the Digital Cash could be considered a stablecoin, the representative reportedly stressed it’s an “internal settlement service” running on a “distributed ledger rail that supports tokenized fiat currency.”

Wells Fargo’s project is planned for next year and will initially completed transfers n U.S. dollars, although in the future it’s expected to add support for multiple currencies. The settlement service has been compared to JP Morgan Chase’s JPM Coin, a cryptocurrency developed for “instantaneous” transfer of payments between the financial giant’s institutional clients.

JPM Coin is a cryptocurrency pegged to the U.S. dollar at a 1:1 ratio, and is built on JPMorgan’s Quorum blockchain. Jamie Dimon, JP Morgan Chase’s CEO, has hinted the cryptocurrency could one day be used for retail payments.

 

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