TAIWAN Law and Practice Contributed by: Robin Chang, Ken-Ying Tseng and Eddie Hsiung, Lee and Li, Attorneys-at-Law
Lee and Li, Attorneys-at-Law 8F, No 555, Sec. 4 Zhongxiao E. Rd
Taipei 110055 Taiwan, R.O.C.
Tel: +886 2 2763 8000 Fax: +886 2 2766 5566 Email: attorneys@leeandli.com Web: www.leeandli.com/EN
1. Overview of Blockchain and Crypto- Assets 1.1 Blockchain 1.1.1 Evolution of Uses of Blockchain In recent years, the Taiwan government has adopt- ed an increasingly stringent and proactive approach toward the regulation of virtual-assets service provid- ers (VASPs), largely in response to the rising number of illegal fundraising cases, fraud cases, money laun- dering activities, and civil disputes involving virtual assets. These concerns have been further magnified by high-profile exchange failures which exposed sig- nificant risks to investor protection and market integ- rity. At present, virtual assets that do not qualify as securi- ties under Taiwan law are primarily governed by the Money Laundering Control Act (MLCA). A significant amendment to the MLCA was enacted in 2024, intro- ducing new registration and compliance obligations for VASPs. Under the revised framework, VASPs are now required to complete anti-money launder- ing (AML) registration with the Financial Supervisory Commission (FSC) before commencing any business operations. Engaging in virtual-asset services without completing this AML registration constitutes a viola- tion of the MLCA and may subject operators to crimi- nal liability. In light of this change, a large number of existing VASPs had already submitted their registra- tion applications, and as of early May 2026, there are eight registered VASPs under the MLCA framework. In addition to strengthening AML oversight, the FSC published a draft bill for a dedicated piece of legisla-
tion – the Virtual Asset Service Act – in 2025. This draft bill was reviewed and submitted by the Executive Yuan (the cabinet) to the Legislative Yuan (the congress) in April 2026. This proposed law introduces a compre- hensive licensing regime for VASPs and is intended to provide a clearer legal foundation for the regulation of the virtual-asset industry. While its passage remains uncertain, it signals a shift toward a more formalised and robust regulatory framework in Taiwan. 1.1.2 Regulatory Sandbox To foster fintech innovation and support the devel- opment of emerging financial services, the Taiwan government enacted the Financial Technology Devel- opment and Innovative Experimentation Act, com- monly referred to as the “Sandbox Act”, in 2018. This legislation established a formal regulatory sandbox framework designed to encourage experimentation with novel fintech business models and technologies, while ensuring that consumer protection and financial stability are not compromised. Under this framework, eligible fintech companies are permitted to conduct time-limited trials of their services and products in a controlled regulatory environment. During these trial periods, certain legal and regulatory requirements may be conditionally waived, subject to the oversight and supervision of the competent regulatory author- ity, the FSC. The goal is to provide a safe space for innovation while gathering empirical data to inform future regulatory adjustments. Since the enactment of the Sandbox Act, the FSC has approved multiple blockchain-related projects for inclusion in the sandbox. Notable examples include a blockchain-based interbank fund transfer system,
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