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Virtual Currency Wave Hits - Taiwan Must Formulate Industrial Policies
▲ Tsai Yu-Ling, Convener of the Supervisory Board, moderating a panel discussion at the 2023 Annual Meeting.
By: Li Hsun-Ying
On June 7, 2023, the Taiwan Jade Mountain Science and Technology Association held its 11th Second General Membership Meeting. Under the leadership of Chairman Tzu-Hsien Tung and Supervisory Board Convener Tsai Yu-Ling, the event focused on AI and Web3, featuring keynote speeches from Google Taiwan Managing Director Ma Ta-Kang and Mysten Labs Founder Cheng Yu-Cheng. The latter half included a dynamic panel discussion moderated by Convener Tsai, which sparked enthusiastic engagement.
With extensive experience in finance, technology, and law, Convener Tsai closely follows Taiwan's development in blockchain and virtual currencies—key areas of fintech innovation. In this exclusive interview, she shares sharp observations on Taiwan's financial innovation landscape.
The Inevitable Virtual Economy
Convener Tsai emphasized that Web3 is a revolution bridging the physical and virtual worlds, with virtual currencies at its core. Since Bitcoin's debut in 2009, the virtual currency market has grown exponentially, peaking at a $2.97 trillion market cap in November 2021. However, by July 2023, this had declined to $1.2 trillion amid market volatility.
Despite high-profile collapses like FTX and LUNA, global adoption continues rising. Over 420 million people now hold virtual currencies, led by India (103 million users) and Vietnam (20.54% penetration rate).
Key Trends:
- BRICS Nations: Exploring a common digital currency to reduce dollar reliance.
- Islamic Coin: Launching in September 2023 as a Sharia-compliant digital currency.
- Corporate Adoption: Starbucks, McDonald’s, and GUCCI now accept crypto payments.
👉 Explore how global brands are integrating crypto payments
Global Competition for Crypto Hub Status
Major financial centers—London, Singapore, Hong Kong, and Dubai—are vying to become crypto hubs by enhancing regulatory frameworks and infrastructure.
Central Bank Digital Currencies (CBDCs)
The IMF is developing a platform for CBDCs, while China aggressively promotes its digital yuan to accelerate de-dollarization. "Taiwan, as the second-largest RMB market, must monitor these developments closely," warned Convener Tsai.
Regulatory Landscapes
- U.S.: SEC lawsuits against Binance/Coinbase contrast with support for new exchanges like EDX.
- EU: MiCA framework aims to unify crypto regulations across Europe.
- Asia: Singapore and Hong Kong are advancing progressive policies, with Hong Kong now accepting virtual asset trading platform applications.
Convener Tsai noted, "While the U.S. tightens rules, Hong Kong seizes the opportunity—a shift to 'East over West' in crypto policy."
Taiwan’s Strategic Gap
In 2023, Taiwan’s FSC became the regulatory body for virtual asset platforms, mandating "self-regulation" for industry safety. However, Convener Tsai critiqued the absence of a national industrial policy: "When the world races to lead in crypto, Taiwan focuses only on risk prevention."
Her Recommendations:
- Policy Clarity: Determine whether the FSC or Ministry of Digital Affairs should drive crypto strategy.
- Innovation-Friendly: Adopt a "small government" approach to avoid stifling creativity.
- Global Expansion: Taiwanese firms must diversify beyond domestic markets to mitigate risks.
👉 Why multi-country strategies matter in crypto
Call to Action for Jade Mountain Members
Convener Tsai urged the Association’s manufacturing and finance members to explore cross-sector collaborations in Web3 and AI: "Ask ‘What’s next?’ and spark new synergies."
FAQs
Q: Why is Taiwan lagging in crypto policy?
A: Unlike proactive hubs (e.g., Singapore), Taiwan lacks a top-down industrial strategy, focusing instead on reactive regulation.
Q: How can Taiwanese companies compete globally?
A: By expanding internationally and leveraging Taiwan’s strengths in tech and finance within a supportive regulatory sandbox.
Q: What’s the role of CBDCs in crypto adoption?
A: CBDCs like China’s digital yuan may reshape cross-border transactions, urging Taiwan to adapt its financial infrastructure.
▲ Panel discussion on AI/Web3 at the 2023 Annual Meeting, moderated by Tsai Yu-Ling (far left).