The Financial Supervisory Commission (FSC) yesterday said it would take a cautious approach toward implementation of securities token offerings (STOs), as it plans to introduce new laws by June to address the growing popularity of virtual currencies.
Interested parties might be allowed to raise up to NT$30 million (US$973,489) through STOs, but blockchain-based tokens would not be allowed as equities, the commission said.
A securities token is a kind of virtual currency. Unlike bitcoin, which has no central issuer and can only be released through a process called “mining,” securities tokens are launched by companies aiming to raise funds.
“The securities tokens are issued in foreign countries as digital assets based on blockchain technology,” Securities and Futures Bureau Deputy Director-General Tsai Li-ling (蔡麗玲) told the Taipei Times by telephone.
“So far, holders of securities tokens enjoy certain ownership in the issuing companies and can receive dividends as if they are investing in stocks,” Tsai said.
“They can also receive interest payments from the sale of securities tokens as with corporate bonds,” she said.
As securities tokens possess securities-like attributes, their issuance would be subject to traditional securities regulations, she said.
However, the commission initially would only permit securities tokens to offer interest payments as bonds and would require the issuers to clearly state how many they plan to distribute, Tsai said.
The commission would prohibit companies from offering equities-like tokens, as such practice is more strictly regulated by the Company Act (公司法), she said.
“The offering of equities-like tokens are possible, but we prefer a step-by-step approach to see how STOs do first,” Tsai said.
The commission’s threshold of NT$30 million for fundraising followed discussions with several parties interested in STOs, Tsai said, adding that the amount should be enough for start-ups, or small or medium-sized enterprises.
Unlike an initial public offering, STOs would be exempted from some administrative requirements and could proceed much faster, Tsai said.
As for companies that intend to raise more than NT$30 million through an STO, they would have to run experiments in a regulatory sandbox so the commission could carefully monitor the risks, Tsai said, adding that sandbox investments would be limited to NT$200 million.
“So far, more than one company has expressed interest in running a sandbox experiment to provide virtual-currency services, but not everyone plans to launch an STO, a new investment tool that began to emerge in the second half of last year,” Department of Planning Director-General Lin Chih-chi (林志吉) said.
Maicoin (現代財富科技), a local platform for virtual currencies, has expressed an interest in an STO, Lin said.
The commission would counsel the firm before accepting its formal application, he said.
The commission would establish an independent platform for the trade of security tokens that is different from the Taiwan Stock Exchange or the Taipei Exchange, it said.
The commission said that plans to issue special licenses to companies operating virtual currencies, which would require special software to accept sell and buy orders.
However, the commission still has many issues to resolve, such as whether tokens should be standardized, or if tokens should be secured by collateral.
“We have outlined our strategy, but there is more to be discussed,” Tsai said, adding that the commission has invited private-sector parties to a forum next week to discuss the proposed regulations in detail.
Shares of contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) came under pressure yesterday after a report that Apple Inc is looking to shift some orders from the Taiwanese company to Intel Corp. TSMC shares fell NT$55, or 2.4 percent, to close at NT$2,235 on the local main board, Taiwan Stock Exchange data showed. Despite the losses, TSMC is expected to continue to benefit from sound fundamentals, as it maintains a lead over its peers in high-end process development, analysts said. “The selling was a knee-jerk reaction to an Intel-Apple report over the weekend,” Mega International Investment Services Corp (兆豐國際投顧) analyst Alex Huang
TRANSITION: With the closure, the company would reorganize its Taiwanese unit to a sales and service-focused model, Bridgestone said Bridgestone Corp yesterday announced it would cease manufacturing operations at its tire plant in Hsinchu County’s Hukou Township (湖口), affecting more than 500 workers. Bridgestone Taiwan Co (台灣普利司通) said in a statement that the decision was based on the Tokyo-based tire maker’s adjustments to its global operational strategy and long-term market development considerations. The Taiwanese unit would be reorganized as part of the closure, effective yesterday, and all related production activities would be concluded, the statement said. Under the plan, Bridgestone would continue to deepen its presence in the Taiwanese market, while transitioning to a sales and service-focused business model, it added. The Hsinchu
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has approved a capital budget of US$31.28 billion for production expansion to meet long-term development needs during the artificial intelligence (AI) boom. The company’s board meeting yesterday approved the capital appropriation plan for purposes such as the installation of advanced technology capacity and fab construction, the world’s largest contract chipmaker said in a statement. At an earnings conference last month, TSMC forecast that its capital expenditure for this year would be at the higher end of the US$52 billion to US$56 billion range it forecast in January in response to robust demand for 5G, AI and
Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) investment project in Arizona has progressed better than expected, but it still faces challenges such as water and labor shortages, National Development Council (NDC) Minister Yeh Chun-hsien (葉俊顯) said yesterday. Speaking with reporters after visiting TSMC’s Arizona hub and attending the SelectUSA Investment Summit in Maryland last week, Yeh said TSMC’s Arizona site turned a profit of NT$16.14 billion (US$514 million) last year in its first full year of mass production. “TSMC told me it was surprised by the smooth trial run of the first fab, which has left the company optimistic about the project’s outlook,”
RSS