Taiwan's cryptocurrency sector has officially established the Taiwan Virtual Asset Service Provider Association (TVASPA) under the guidance of the government. This milestone marks a crucial step towards regulating the nascent sector, which has been largely unregulated until now. The association comprises 24 crypto firms that have registered with the Financial Supervisory Commission (FSC) for anti-money laundering (AML) compliance.

The TVASPA will be led by Titan Cheng, founder and CEO of BitoPro, one of Taiwan's major exchanges, as its chairperson, while Winston Hsiao, co-founder and chief revenue officer of XREX, will serve as the vice chair. The association's primary objective is to formulate self-regulatory guidelines, aiming to implement the classification and grading management of Virtual Asset Service Providers (VASPs). This move will not only cater to the interests and development of the industry but also meet government expectations and protect consumer rights.

The establishment of the TVASPA is a vital step towards enhancing oversight of crypto trading platforms in Taiwan. The government has mandated the association to come up with self-supervisory rules, demonstrating its commitment to the healthy development of the virtual asset industry. Hsiho Huang, director of the securities firms division at the FSC, emphasized the importance of the industry's development, stating that it is closely related to the development of society and the economy.

Currently, Taiwan requires cryptocurrency service providers to comply with AML laws, which were introduced by the FSC in July 2021. However, the crypto industry remains largely unregulated, with the exception of AML compliance. Last month, the Ministry of Justice proposed amendments to the existing AML laws, which would require domestic and overseas crypto firms seeking to operate in Taiwan to register for AML compliance. Failure to do so could result in imprisonment for up to two years, highlighting the need for self-regulation and oversight in the industry.

The formation of the TVASPA is a significant step towards addressing these issues and promoting a healthy and sustainable development of the virtual asset industry in Taiwan. By establishing self-regulatory guidelines and implementing classification and grading management of VASPs, the association aims to create a more secure and trustworthy environment for consumers and investors, while also meeting government expectations and promoting the growth of the industry. As the crypto landscape continues to evolve, Taiwan's move towards self-regulation is likely to set a precedent for other countries and regions to follow.