The U.S. Securities and Exchange Commission (SEC) recently approved the listing of 11 Bitcoin spot ETFs, which were previously available for purchase by Taiwanese investors through a delegated commission method. However, several Taiwanese securities firms issued announcements on the 23rd, stating that they have received notification from the regulatory authorities. Considering the high volatility and risks of virtual currency commodity prices, they can no longer purchase Bitcoin ETFs through delegated commission methods.
Earlier, the Financial Supervisory Commission (FSC) of Taiwan stated that under current regulations, Bitcoin does not belong to securities with value and is not a component that non-ETFs can track. Therefore, fund management companies cannot issue Bitcoin ETFs. The FSC also stated that single-link and fund-of-fund products cannot be linked to or invested in Bitcoin ETFs. However, regarding whether it is possible to invest in Bitcoin ETFs through securities firms’ delegated commission methods, the FSC responded at that time that delegated commission is different from domestic solicitation and sales, and they are studying whether to allow it. There will be results soon.
Taiwanese securities firms have banned the purchase of Bitcoin ETFs through delegated commission methods. However, mainstream Taiwanese securities firms such as Yuanta Securities, Cooperative Bank Securities, and SinoPac Securities issued simultaneous announcements on the 23rd, stating that they have received notification from the regulatory authorities. Considering the high volatility and risks of virtual currency commodity prices and to protect investors, starting from the 23rd, they can only accept delegated commission sales of foreign securities related to spot and futures of virtual currencies (such as Bitcoin) and cannot accept new delegated commission purchases.
According to Yuanta Securities’ announcement, a total of 21 Bitcoin-related spot and futures ETFs in the U.S. and Hong Kong markets are affected. If there are any changes in the future, they will be controlled in accordance with the requirements of the regulatory authorities and the Securities Association without further notice. Investors are advised to pay attention to related investment risks.
According to Article 37 of the Securities Investment Trust and Consulting Act, the index components tracked by ETFs must be “securities” such as stocks, bonds, or other approved securities, excluding Bitcoin. Huang Hou-ming, Deputy Director of the Securities and Futures Bureau of the FSC, previously pointed out that future modifications to Taiwan’s laws to allow Bitcoin ETFs would require further research and collection of data from various countries for evaluation.
The only legal channel for Taiwanese investors to invest in Bitcoin ETFs is through overseas securities firms. For example, Firstrade, Interactive Brokers, and Charles Schwab Securities. Compared to delegated commission methods, the transaction fees of overseas securities firms are usually lower. However, investors still need to consider transaction fees and bank wire transfer fees when transferring funds abroad.
When investing in related ETFs, the following details should also be noted:
Tax issues: According to Taiwanese law, profits from overseas investments need to be reported for taxation.
Currency exchange and exchange rate risks: Investing in the U.S. stock market usually requires converting funds into U.S. dollars, which may involve exchange rate risks.
Market research: Understanding the dynamics and regulations of the U.S. market is important, including trends in different industries and market supervision regulations. At the same time, understanding and managing investment risks are also crucial.
U.S. stock trading hours: Normal trading hours are from 9:30 am to 4:00 pm Eastern Time. Typically, it is from 9:30 pm to 4:00 am Taiwan time.
How to repatriate funds back to Taiwan after selling: After selling, funds are usually deposited into your U.S. securities account. You can then initiate an international remittance from your U.S. securities account to transfer funds to your bank account in Taiwan.
For more information, please refer to:
How can Taiwanese investors purchase “Bitcoin spot ETF”? A three-step tutorial.
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