Taiwan allows professional investors access to foreign cryptocurrency ETFs

The Taiwan Financial Supervisory Commission has approved a new policy allowing professional investors to invest in foreign cryptocurrency exchange-traded funds (ETFs) through local brokers.

Investor suitability assessment

According to the press release, securities firms must assess the suitability of clients who wish to invest in foreign cryptocurrency ETFs. This is due to the "complex nature of virtual assets and their significant volatility."

The purpose of the assessment is to verify the necessary knowledge and experience of users in handling virtual assets.

Precautionary measures for non-professionals

Non-professional institutional investors are required to sign a risk warning letter before making their first investment. Brokers must also provide detailed information about the products, particularly their risks, before any purchases are made.

The new rules were developed after consultations with the Taiwan Securities Association, which evaluated the high risks associated with ETFs. Limiting access to foreign cryptocurrencies for professional investors will help mitigate risks while offering more investment opportunities that match investors' knowledge and experience levels.