Good day everyone,
I hope you are all having a good day, welcome to CryptoGod-1's blog on all things crypto. In this post I will be looking at the recent comments of a Taiwanese lawmaker in regards to the nation adopting a Bitcoin reserve.
Do Taiwan Need a Bitcoin Reserve
The Taiwanese lawmaker Ko Ju-Chun stated on May 9 that “Bitcoin is the gunpowder of the digital era” while urging Taipei to fortify its $577 billion reserve chest with Bitcoin before there is any currency shocks or conflict strikes the nation. He was speaking at the National Finance Conference when he emphasised that Bitcoin, similar to gold and FIAT currencies, should be recognised as a sovereign reserve asset.
At the time of writing Bitcoin sits at just above $140,000. The last month has seen strong gains once again as Bitcoin broke above the $100,000 mark.
The comments by Ko follow on from his recent engagement with Samson Mow, CEO of Jan3 and a prominent advocate for national-level Bitcoin adoption. Ko works as a legislator-at-large in Taiwan’s Legislative Yuan and he pushed that Bitcoin could and should play an important role in the strength of Taiwan’s financial defence mechanisms. Ko went on to say:
“We currently hold 423 metric tons of gold, and our foreign exchange reserves total $577 billion—including U.S. Treasury bonds. But in the event of rising currency volatility or potential regional conflict, Taiwan may not be able to ensure the safety and liquidity of these reserves.”
Ko explained that Bitcoin’s characteristics, including a fixed supply, decentralization, and censorship resistance, which helps to make Bitcoin a suitable investment and hedge against traditional financial instruments which are increasingly vulnerable to external pressure. Bitcoin has operated for over 15 years without any central authority and remains resistant to embargoes.
“It’s time for Taiwan to think strategically. Bitcoin may not just be a currency. As former Dean Chen Chong said, it could be the gun, the gold, the silver, or even the gunpowder of the digital era. A wise country should never leave such weapons in the hands of others.”
It was further suggested by the lawmaker that a small allocation of Bitcoin, of up to 5% of Taiwan’s $50 billion reserve, would be prudent. It was stressed by him that it would be part of a diversified strategy, not a total shift. Ko also proposed that it is grounded in growing concerns over Taiwan’s economic exposure as an export-reliant nation. It was also noted that the New Taiwan dollar has faced wide fluctuations due to global inflation and tensions in the Asia-Pacific region. Ko noted:
“In moments of severe crisis or regional unrest, traditional reserve assets like bonds or even gold may not guarantee rapid liquidity or security. Bitcoin, with its cross-border, seizure-resistant design, gives us options.”
He also stated that Bitcoin is an additional tool rather than a replacement for existing reserves. Ko added:
“I’m not saying Bitcoin is the only answer. But in a world where exchange rate risks and regional instability are increasing, it’s essential to introduce new tools that can help us build a more flexible and resilient financial strategy.”
The comments from Ko come at a time when Taiwan is developing a crypto regulatory environment. Ko is pushing for Bitcoin adoption nationally and Taiwan’s Financial Supervisory Commission (FSC) has the task of constructing the groundwork for comprehensive virtual asset regulation.
Back on March 25 the FSC revealed their draft of the “Virtual Asset Service Act” which proposed legislative framework around the regulation of the crypto industry in Taiwan. It also aims to invigorate the market and enhance its integrity along with adding investor protections. As part of the draft it noted the rigorous licensing requirements for Virtual Asset Service Providers (VASPs). Among this will include a set of standards which the organisational structures must adhere to, while also setting capital thresholds, and qualified personnel.
Local banks will be able to issue stablecoins pegged to the New Taiwan dollar but they will be required to adhere to strict compliance with issuance guidelines, pending FSC approval. As part of upholding these standards the FSC will be empowered to conduct inspections, monitor compliance, and impose penalties on non-compliant entities.
https://x.com/dAAAb/status/1920759535028903966
Have a great day.
Peace. CryptoGod-1.
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