Could Taiwan open up to the idea of a complex entrusted purchase of Bitcoin ETFs? After obtaining approval in the United States, Bitcoin ETFs quickly became a popular target. Within a week of the launch of the Bitcoin spot ETF, its assets under management surpassed those of the Silver ETF, making it the second-largest commodity ETF in terms of asset management. This clearly demonstrates the market’s high interest in virtual assets.
However, due to the significant price volatility and high risk associated with virtual currency products, Taiwanese users are currently unable to purchase the “Bitcoin spot ETF” through complex entrusted purchases, as the regulatory authorities in Taiwan are committed to protecting investors.
With the inauguration of the new cabinet on May 20th, the new chairman of the Financial Supervisory Commission (FSC), Huang Tien-Mu, revealed during a legislative session on May 22nd that the Securities and Futures Institute had submitted a proposal on April 22nd, hoping to open up complex entrusted purchases based on two conditions.
Huang Tien-Mu stated that currently, South Korea and Japan have not opened up, while Singapore, Hong Kong, and Thailand have conditionally allowed it. Therefore, taking international experience into consideration, the Securities and Futures Institute proposed the possibility of opening up complex entrusted purchases. However, this would be subject to the following two conditions:
Firstly, it would be opened to professional investors, including corporations or individuals with assets exceeding NT$30 million, rather than being directly accessible to the general public.
Secondly, investors would be required to sign a risk warning document before engaging in complex entrusted purchases.
Nevertheless, the exact timing for opening up complex entrusted purchases of Bitcoin spot ETFs is expected to be decided before the end of this year.
Legislator Ge Ju-Jun: Opening up to the general public is also necessary
Chang Chen-Shan, director of the Securities and Futures Bureau of the FSC, stated that since Bitcoin is not considered a valuable security, investment trust funds are not allowed to issue Bitcoin ETFs. However, many industry players are indeed striving to open up and introduce foreign Bitcoin ETF products.
Legislator Ge Ju-Jun also called for the opening up of Bitcoin spot ETF investments to the general public. In March of this year, Ge Ju-Jun raised this issue during a legislative session with Huang Tien-Mu. He pointed out that without an official process and method for complex entrusted purchases, many people who want to buy Bitcoin ETFs will resort to using overseas brokers.
This not only makes it more difficult for the government to monitor the investment situation of the public in Bitcoin ETFs but also reduces the brokerage fees earned by securities firms. When individuals have investment disputes with overseas brokers, they would have to bear the risks themselves, and there is even a possibility of falling into scams without any protection. This would result in a lose-lose situation for the government, securities firms, and the public.
Regarding whether Taiwan has a real chance of opening up to Bitcoin ETF products, the FSC stated that it has requested the Investment Trust and Consulting Association to conduct research and expects to discuss a clear policy by the end of this year.
