Will Taiwan ban Bitcoin?

Crypto-currencies started off on the wrong foot in Taiwan. In November 2015 a wealthy Hong Kong merchant was badly beaten and then ransomed for a great deal of Bitcoins by unidentified culprits. That sparkled an immediate reaction from the head of the main securities regulator - Financial Supervisory Commission (FSC) - who staunchly proclaimed crypto to be from now on "illegal" in Taiwan.

Soon enough this statement had been officially denounced and claimed on an inaccurate journalist's reporting. Instead of banning digital money, authorities claimed, FSC will only make sure that crypto-currencies are to be used for "legal purposes". General public was also referred to the joint communique issued in 2013 by FSC in a collaboration with the Central Bank of the Republic of China (Taiwan). This product of bureaucratic genius had found Bitcoin to be of the "non-currency nature" and tagged as the "virtual commodity".

That, of course, besides being plain stupid also created a legal conundrum, which is similar in nature to that, which followed the US IRS's decision to treat Bitcoins as "assets" subjected its to the capital gain tax. On a positive side, this short-sited decision, at least temporarily, put crypto-currencies in Taiwan outside of the immediate blast area covered by bureaucratic weapon of entrepreneurship mass-destruction.

However, in October 2017, one of the Taiwanese Central Bank's top dogs reiterated the issue, saying that Bitcoin transactions must be subjected to the intense money anti-laundering scrutiny, which, once again, placed Taiwanese crypto-community on the edge. Nevertheless, it's still very unlikely that local regulators will follow steps of their Chinese counterparts by blowing crypto completely out of the local financial pond's water.

Business Notes for Startups Founders:

political climate: indifferent;
economic climate: moderately friendly;
regions to focus: locally;
industries to focus: many, including, FinTech, security, e-commerce, e-gaming, media, SaaS;
major limitations: sluggish economy (GDP growth rate at 2%);
stimulus: manufacturing and services constitute more than 90% of GDP, high-income population (per-capita over $24,000), well developed infrastructure, highly qualified work-force;
opportunities: to compete with mainland e-corporations on local niche markets.
Cryptocurrencies and ICOs (outlook): legal (positive).
The author: Svyatoslav (Svet) Sedov
Angel investor and founder of The First International Incubator for Silicon Valley Companies (FirstInternational.In) in the Bay Area, CA, USA.

Twitter: https://twitter.com/SvjatoslavSedof