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Credit Cards Should Not Be Used for Crypto Transactions, Taiwan’s Financial Watchdog Says

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Taiwan’s financial regulator has asked local banks not to allow the use of cards for payments in cryptocurrency transactions, local media reported. Authorities say these assets are risky and the cash flows associated with them are difficult to control.

Taiwan regulator urges banks not to allow crypto payments with bank cards

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Taiwan Financial Supervision Commission (LPS) has ordered credit card issuers and banks to effectively prohibit their customers from using credit cards as a payment instrument in transactions involving cryptocurrencies, according to report This is reported by the business news portal UDN.

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The watchdog cites the recent downturn in the cryptocurrency market, as well as ongoing concerns about the money laundering risks associated with virtual assets, which it also describes as highly speculative and highly volatile.

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Financial industry sources say FSC sent a letter to the Taiwan Bankers’ Association earlier in July. Authorities did not deny the news this week or comment on it initially. He later confirmed to Forkast that he asked credit card agencies not to sign crypto service providers as sellers.

The commission insisted that credit cards serve as a means of payment for consumption rather than a method of financial investment and speculative trading, and gave card acquirers three months to comply with the new rules. The FSC also reminded people of the prerequisite prohibiting the use of credit cards for payments in transactions related to stocks, futures and options.

Taiwan’s cryptocurrency sector remains largely unregulated despite the adoption of updated anti-money laundering (AML) regulations for service providers in the market last summer. The country has yet to complete a project to issue a central bank digital currency (CBDC).

In June, the Taiwanese central bank completed a series of technical simulations in a closed environment as part of ongoing testing of a retail digital currency prototype. However, the monetary authority acknowledged that it could take another two years for the bank to complete work on the CBDC, twice as long as anticipated.

Do you expect Taiwan to impose other restrictions on cryptocurrency-related transactions in the future? Let us know in the comments below.

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Credit : news.bitcoin.com

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