Taiwan Stablecoin Policy: Financial Supervisory Commission and Central Bank Take Divergent Stances, Earliest Launch in Mid-2026 But Direction Unclear

Taiwan adopts a cautious and wait-and-see attitude toward stablecoins. A recent report by Topics, a publication under the American Chamber of Commerce, pointed out that Taiwanese regulators have always been prudent regarding financial stability and investor protection. Although interest in stablecoins is increasing, there is still no consensus on whether fiat-backed cryptocurrencies should be classified as traditional currency.

Financial Supervisory Commission: Launch as early as mid-2026, restricting issuance to licensed financial institutions

FSC Chair Peng Jinlong stated in December last year that Taiwan’s local stablecoin could be launched as early as June or July 2026, provided that the legislative process for the Virtual Asset Service Act proceeds smoothly. The draft law will require businesses to register or obtain licenses, meet capital and operational thresholds, implement anti-money laundering controls, and comply with consumer protection and reporting requirements.

Peng Jinlong also pointed out that the FSC and the Central Bank have reached a consensus: stablecoin issuance will be limited to licensed financial institutions to manage risks and protect user funds.

Central Bank’s stance is more conservative, questioning whether it meets monetary system standards

Compared to the FSC, Central Bank Governor Yang Jinlong demonstrated a more cautious stance at a press conference in December last year. He admitted that the adoption rate of fiat-backed virtual currencies has indeed risen rapidly, but they have not yet “reached the standards required to serve as a pillar of the monetary system,” nor do they meet key standards such as monetary unification, flexibility, and integrity proposed by the Bank for International Settlements (BIS).

Yang Jinlong also questioned whether Taiwanese consumers would use TWD stablecoins for daily transactions, believing that the general public might not perceive obvious benefits. He expects the first applications to be in the virtual asset market and the tokenization of real-world assets (RWA).

TWD or USD? Both paths have their considerations

Taiwan has not yet decided whether to issue TWD-pegged or USD-pegged stablecoins. Zennon Kapron, director of fintech consultancy GSL Insight, analyzed that Taiwan’s push for stablecoins focuses on upgrading the payment system rather than simply popularizing cryptocurrencies:

TWD stablecoin: Provides a compliant alternative for local payments, retains monetary control over TWD, but has limited offshore circulation.

USD stablecoin: More suitable for cross-border settlements and liquidity in the crypto market, but involves foreign exchange expectations management and concerns about “dollarization.”

Kapron’s pragmatic approach is: the TWD version is for domestic use, while the USD version, if launched, should be strictly limited to institutional cross-border fund flows.

James Lee, senior advisor at TAITRA, pointed out that issuing a TWD-pegged stablecoin is feasible but requires deepening the domestic bond market, increasing short-term interest rate competitiveness, and attracting non-residents’ demand for TWD assets—fundamental reforms of Taiwan’s trade surplus model over the past fifty years. He believes Taiwan’s greater opportunity lies in building on the existing USD-based network.

According to the October 2025 index of cryptocurrency and stablecoin adoption in 121 countries by startup TRM Labs, Taiwan ranks 47th. The Central Bank’s cautious attitude toward stablecoins and the requirement for formal consultation suggest that Taiwan’s stablecoin rollout is “essentially a legal and design issue, not a technical one.”

This article, “Taiwan Stablecoin Policy: Divergence Between FSC and Central Bank, Launch Expected by Mid-2026 but Direction Uncertain,” was first published on Chain News ABMedia.