Stablecoin Rollout and Regulatory Landscape
Taiwan could reportedly roll out its first locally issued stablecoin as early as the second half of 2026. However, regulators have not yet decided whether the token will peg to the New Taiwan dollar (NTD) or the US dollar (USD).
According to local media in Taiwan, Financial Supervisory Commission Chair Peng Jin-long told lawmakers this week that the draft Virtual Assets Service Act has cleared initial cabinet reviews and could pass its third reading next session. To that end, regulations specific to stablecoins would follow within six months, putting the earliest possible launch in late 2026.
Challenges and Considerations for Taiwan's Stablecoin
Analysts have called Taiwan a late stablecoin adopter that could struggle in the market. The Financial Supervisory Commission (FSC) and Taiwan’s central bank have agreed that financial institutions will lead issuance in the initial stage. However, the legislation does not restrict issuers to banks.
What remains unclear is the currency backing. This is a choice that will shape the project’s impact on the region’s currency controls. A US dollar-backed coin would bypass the strict limits on exporting the Taiwan currency offshore. On the other hand, Taiwan’s currency cannot legally circulate offshore, and the central bank has a long record of policing attempts to use it for transactions without a direct connection to the island.
James Lee, a senior advisor at the Taiwan External Trade Development Council (TAITRA), previously warned against both ideas. According to him, Taiwan should be cautious due to the lack of scalability and the low interest return of roughly 1% on reserves compared to 4% in the US.
“Why would somebody use a less well-known stablecoin that is in USD, let alone a Taiwan dollar pegged stablecoin when they can use USDC and USDT for zero switching costs? It is very difficult for latecomers to compete with these aside from very niche players,” he added.
For now, regulators are drafting rules based on full reserve backing, strict segregation of assets, and domestic custody requirements. Recently, Taiwan’s central bank has called for a licensing role in the FSC’s draft Virtual Asset Services Act (VASA) to determine risks to foreign exchange and payment system rules.
The draft act is Taiwan’s first dedicated effort to supervise digital assets businesses. The legislation will cover Taiwan dollar (TWD) and USD pegged stablecoin issuance. It is currently under review by the Executive Yuan – Taiwan’s highest administrative body.
Meanwhile, several local banks are preparing for a regulated stablecoin era. O-Bank has expressed interest in launching a Taiwan dollar-pegged coin. Meanwhile, KGI Bank signed a memorandum with Tether in October to build token-enabled cross-border finance applications. Cathay United Bank is also exploring stablecoin issuance, pending regulatory clarity.
Global Stablecoin Trends and Competition
Current data indicates that approximately 99% of stablecoins currently on the market are USD-pegged. This reveals the absolute dominance of the US dollar in the digital asset sector. This is a result of joining early and the passage of the US GENIUS Act.
In response, nations have begun positioning themselves to issue stablecoins pegged to their own fiat currencies, especially in the coming year. In Europe, banks have come together in a collaborative effort called Qivalis to develop an EU-based token designed for on-chain payments.
The group intends to introduce the stablecoin in the second half of 2026, positioning the project under the EU’s Markets in Crypto-Assets (MiCA) regulatory regime. Israel has also set the launch date of the digital shekel somewhere in 2026. To that end, it is preparing to tighten its regulations.
Additionally, Japanese Sony Bank is set to launch a dollar‑backed stablecoin in America as early as fiscal 2026. The stablecoin will be used to pay for games, anime, and digital subscriptions across Sony’s ecosystem.
At the same time, South Korea is reportedly working on a plan to restrict the issuance of Korean-won-pegged stablecoins to consortia in which commercial banks hold a majority stake. Meanwhile, the total global issuance of stablecoins is projected to reach between $1.9 trillion and $4 trillion by 2030.