Taiwan steps into the world of virtual assets

Taiwan is positioning itself to become a key regional hub in the rapidly growing virtual asset industry.

The global virtual asset market is rapidly evolving, with major financial players like BlackRock and State Street investing billions in crypto and exploring tokenized funds. At the same time, emerging economies and fast-moving markets are trying to find a balance between embracing innovation and enforcing regulations.

Taiwan is known for its strong technology sector. Taiwan's government is positioning the country to become a key player in the growing virtual asset industry.

Financial Institutions take the helm

Until recently, cryptocurrencies were seen as the domain of retail speculators and libertarian enthusiasts. Today, the perception has shifted dramatically.

BlackRock, the world’s largest asset manager with US$12.5 trillion under management, held over $104 billion in crypto assets by August 2025, including more than 743,000 Bitcoin and 3.2 million Ether. Although this is less than one percent of its total portfolio, it carries significant symbolic weight. BlackRock has also launched the iShares Bitcoin Trust ETF, which has become a key benchmark for institutional acceptance of virtual assets.

BlackRock is also actively expanding beyond passive holdings. Its USD Institutional Digital Liquidity Fund (BUIDL), a tokenized money market fund initially launched on Ethereum and expanded to Solana in 2025, now manages over US$1.7 billion, making it the largest tokenized fund globally. Robert Mitchnick, BlackRock’s digital assets head, highlighted the potential of Ether ETFs that incorporate staking—combining traditional ETF structures with on-chain yields, which could transform investor interest.

Other major firms like Vanguard and State Street are cautiously advancing, with indirect crypto holdings or by developing custody services for future crypto integration. These moves mark a turning point: virtual assets are no longer outside mainstream finance but firmly inside its core. Amid this shift, Taiwan, strategically located in the Indo-Pacific, is positioning itself to capitalize on these emerging opportunities.

The Taiwanese moment: From periphery to participant

For Taiwan, a global leader in semiconductors and digital innovation, the rise of virtual assets presents both promise and pressure. The promise lies in leveraging its tech ecosystem, entrepreneurial talent, and global networks to become a hub for compliant, innovation-led crypto finance. The pressure comes from the risk of regulatory inertia, which could leave Taiwan trailing behind regional competitors like Singapore, Hong Kong, and South Korea.

Signs of a pivot are already visible. On May 22, 2025—Bitcoin Pizza Day—Taiwan Mobile, the island’s second-largest telecom operator, launched TWEX, the country’s first major telecom-backed crypto exchange. Run by its subsidiary Fusheng Digital, TWEX offers a secure, KYC- and AML-compliant platform with low entry barriers (NT$100, or about US$3), aiming to make virtual asset investment safer and more accessible for average users.

Within a month, over 10,000 users registered—including Taiwan business titan Daniel Tsai (蔡明忠), chairman of Fubon Group and Taiwan Mobile, who publicly bought Bitcoin for the first time. Tsai, at the official launch press conference of TWEX, encouraged others to explore this new Web3 frontier. It lends both credibility and visibility to the initiative.

TWEX’s success is closely tied to its leadership. Taiwan Mobile President Jamie Lin (林之晨)—also founder of AppWorks and IDC’s 2024 CEO of the Year—has positioned TWEX as a tool for long-term, responsible investing. He, during the same aforementioned event, promoted strategies like dollar-cost averaging and, in a personal anecdote, shared his own 2013 Bitcoin purchase, calling it the best investment of his life.

With only about 5% of Taiwan’s population currently engaged in virtual assets, the market remains wide open. TWEX has expanded participation beyond the usual 18–29 demographic, attracting men aged 30–49—typically more risk-averse—who now see a more secure and approachable way to enter the crypto space.

TWEX also fits into Taiwan Mobile’s broader “Telco+Tech” strategy. This vision reimagines telecom firms as platforms for financial and technological services by integrating Web3, AI, and cybersecurity tools alongside core connectivity. As such, TWEX is not just a crypto exchange—it’s a foundational step in Taiwan’s push to align telecom infrastructure with the future of digital finance.


Virtual Asset Services Act

Taiwan is signaling a major shift in its approach to digital asset regulation with the introduction of the Virtual Asset Services Act, currently under legislative consultation. Drafted by the Financial Supervisory Commission (FSC), the Act would mandate licensing for exchanges, custodians, transfer agents, and underwriters.

It also sets out harsh penalties for misconduct, including fines up to NT$200 million (approximately US$6.7 million) and prison terms of up to ten years for fraud, money laundering, or market manipulation. This marks a strong stance by Taiwanese regulators to root out illicit activities in the crypto space.

In parallel, Taiwan has launched a Virtual Asset Service Provider (VASP) industry association, encouraging self-regulation within a government-supervised framework. This dual model aligns Taiwan with established financial hubs and reflects a commitment to international best practices rather than regulatory laxity.

Industry pushes for derivatives market to stay competitive

While exchanges like TWEX target retail adoption, industry leaders such as MaiCoin are calling for broader access to complex financial instruments. At the "2025 Virtual Asset Future: Derivatives Supervision Policy Forum" in July, MaiCoin executives urged regulators to open the door to crypto derivatives, including structured products, ETFs, stablecoins, and tokenized real-world assets.

The absence of these tools, they warn, could push capital offshore as institutional investors seek more robust options abroad. Derivatives are essential for hedging and liquidity, and their availability is critical for attracting serious institutional interest.

As the industry anticipates a phased rollout to balance innovation with sound risk management, such an approach emphasizes responsible engagement with policymakers, focusing on ecosystem development rather than deregulation.

Stablecoins and strategic sovereignty

Following the US passage of the GENIUS Act in July 2025, MaiCoin CEO Alex Liu, in a piece he wrote for Taiwan's Wealth Magazine, noted it as a timely signal for Taiwan’s own digital asset trajectory. He highlighted how the Act paves the way for Taiwanese institutions to issue a New Taiwan Dollar–denominated stablecoin.

Such a stablecoin could shift the current dominance of U.S. dollar–pegged tokens, while providing macroeconomic advantages. By softening the effects of a strong NTD on exporters like TSMC and simplifying currency conversion for businesses, it would turn a long-standing challenge into a competitive edge.

Taiwan's regulation balancing act 

It would be naive to expect a smooth or linear path for Taiwan’s virtual asset sector. Overzealous regulation could choke emerging innovators, while too little oversight risks reputational harm—especially in a region where financial integrity is under constant scrutiny.

Bloomberg journalist Zeke Faux’s book "Number Go Up" highlighted this tension, recounting how Tether at one point deposited funds in Taiwan before local banks severed ties. Compounding concerns, certain crypto players in Taiwan have also been subject to criminal investigations as documented by Taiwan's Commercial Times.

The regulatory challenge now is to strike a careful balance: safeguarding investors without stifling innovation. Policymakers appear increasingly aware of this need for calibration.

By rolling out reforms in stages—beginning with licensing, custody rules, and anti-fraud measures before tackling derivatives—Taiwan aims to align caution with competitiveness. The involvement of blue-chip firms like Taiwan Mobile further bolsters credibility, lending institutional weight that startups alone cannot provide.


Taiwan weighs its role in the evolving virtual asset landscape

In the global race to regulate virtual assets, the United States and Europe continue to set much of the pace. In Asia, Singapore and Hong Kong have long competed to lead the sector, with recent developments giving Singapore a slight edge. However, Hong Kong is pushing back with its new Stablecoins Ordinance, launched on August 1, 2025. According to Bloomberg, the measure is aimed at facilitating cross-border payments and reducing reliance on the U.S. dollar, as it seeks to reassert itself in digital finance.

Other regional players are also moving quickly. Japan was among the first to implement a licensing regime for exchanges, while South Korea is now integrating digital assets more deeply into its financial system. Against this backdrop, Taiwan faces a strategic decision point: how to define its place in the virtual asset economy.

If Taiwan moves carefully, it could emerge as a credible mid-sized jurisdiction—one that balances regulatory clarity with innovation, and benefits from its strong base in semiconductors, blockchain technology, and fintech entrepreneurship. Its geographic and geopolitical position within the Indo-Pacific also adds weight to its potential role.

But time and execution are critical. Delays risk leaving Taiwan behind, while premature liberalization could create vulnerabilities. Policymakers must align regulation with market readiness, ensuring stability while creating space for growth.

Strategic crossroads

Global interest in virtual assets is no longer speculative—it's increasingly institutional. Firms like BlackRock, Vanguard, and State Street have entered the market, reflecting broader adoption trends. For Taiwan, the decision is not simply whether to participate, but how to shape a role that adds long-term value to its financial system. If it can deliver, Taiwan stands a real chance of becoming a relevant and respected player in the virtual asset space.