Taiwan Announces Rules For Fundraising By STO

In contrast to most countries, who require STOs to comply with existing laws that regulate securities, Taiwan has adopted special rules for security token offerings, Taiwan Financial Securities Commission Chairman Wellington Koo (顧立雄) said:

“It was not easy to establish a set of regulations, considering there was little to reference in other nations. We needed to balance consumer protection and industrial growth, and curb market volatility.”

The commission set the amount of NT$30 million (US$964,599) to be a fundraising limit stipulated in the draft regulation.

However, companies who want to raise more funds will be able to apply for a permit, to run it as an experiment in the regulatory sandbox.

Also, to manipulating token prices, the daily number of traded tokens æ may not exceed half of the total number of issued tokens.

Private companies registered in Taiwan will be allowed to conduct STOs, but listed companies will not, since they already employ other fundraising tools.

Companies will not be permitted to issue tokens on more than one exchange. The exchange will be responsible for checking issuers’ qualifications and overseeing their white papers.

Exchanges that wish to launch their own securities tokens will be monitored by the Taipei Exchange, and only exchanges with paid-in capital of more than NT$100 million will be able issue STOs having obtained a securities dealer license. Such exchanges will be limited to help companies conduct one STO per year with cumulative funds raised may not exceed NT$100 million.

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