Taiwan may allow retail investments in overseas cryptocurrency exchange-traded funds, a move that is unlikely to trigger capital outflows from the island, according to Julian Liu, executive chairman of Yuanta Securities Investment Trust Co.
A spokesperson for the Financial Supervisory Commission (FSC) told reporters recently that the regulator is studying the feasibility of the move.
“First of all, securities firms conduct know-your-customer and know-your-product processes to ensure investors fully understand the potential risks of virtual assets,” Liu says in an interview with Asia Asset Management. “Investors are already aware of the volatility in the crypto markets and have the discretion to decide whether to invest.”
He says crypto ETFs are not entirely new to retail investors because local fund managers have already launched multi-asset funds that can allocate as much as 10% of total assets to digital asset ETFs.
Institutions, and professional investors with at least NT$30 million (US$950,000) in net assets, have been allowed to buy foreign virtual asset ETFs, including bitcoin ETFs, through 13 local securities firms since September 2024. FSC figures show that cumulative turnover in overseas bitcoin ETFs in Taiwan since then was nearly NT$10 billion.
Taiwan is also moving towards allowing local asset managers to launch domestic bitcoin ETFs. The FSC is now developing a framework through the Virtual Asset Service Act to facilitate the launch.
“Related regulations are expected to be introduced as early as the second half of this year once they receive legislative approval,” Liu says.
Yuanta Securities Investment Trust Co is Taiwan’s largest ETF manager, with more than NT$1 trillion of ETF assets.
