Taiwan’s Financial Supervisory Commission (FSC) has allowed professional investors to venture into foreign virtual asset exchange-traded funds (ETFs) via sub-brokerage. By allowing more diverse investment channels, the FSC aims to boost local brokerage operations while carefully managing the high risks of virtual assets. Stringent measures, including investor suitability checks and mandatory risk disclosures, ensure that only those with adequate knowledge can engage in these complex investments.
Taiwan's Regulator Allows Professional Investors to Access Digital Asset ETFs
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Taiwan Approves Virtual Asset ETFs for Professional Investors
Taiwan’s Financial Supervisory Commission (FSC) announced on Monday that professional investors are now permitted to invest in foreign digital asset exchange-traded funds (ETFs) through sub-brokerage. This move aims to provide investors with more diverse investment options and enhance local brokerage firms’ sub-brokerage operations. The FSC also recognized the higher risks associated with investing in virtual asset ETFs, considering the volatility of such assets.
The FSC outlined several key measures to accompany this new policy. Only professional investors, including high-net-worth individuals, institutional investors, and entities or funds classified as professional, will be allowed to trade in foreign virtual asset ETFs. Securities firms must establish a suitability system for virtual asset ETFs and obtain board approval for the same. Before accepting an order, they must ensure that the clients possess sufficient expertise and experience in virtual asset investments. The SFC stated:
Securities firms must evaluate the client’s knowledge and experience before facilitating a transaction.
Additionally, non-institutional clients must sign a risk disclosure statement before placing their first order. Firms must also provide comprehensive product information to non-institutional investors ahead of the first transaction. Regular training sessions on virtual asset products will be mandated for securities firm personnel. The FSC will continue monitoring the execution of sub-brokerage services to protect investors’ rights and further strengthen relevant regulations.
What do you think about Taiwan’s move to allow professional investors to tap into virtual asset ETFs? Let us know in the comments section below.
