Dr. Bao Ge Rujun: Taiwan has ready Bitcoin reserves! Cryptocurrency law is better off not having it

In answering this question, Ko first addressed the concerns raised by the public about including Bitcoin in the national reserves. He believes that as a digital asset, the storage and management of Bitcoin should not be overly complicated or exaggerated in terms of technical difficulty. He said: "Many people hear about Bitcoin and feel it is mysterious, as if it is particularly difficult to store, but in fact, for a country, this is no different from the technical threshold of protecting personal privacy data or confidential documents." He further explained that the government's information security departments are already accustomed to handling highly sensitive data, such as tax information or national defense secrets, and the management of Bitcoin private keys is just a similar digital security issue, which is not a technical barrier that is difficult to overcome. "If the government has the ability to protect these data, then designing a secure cold storage system to preserve Bitcoin, or managing related digital assets, should be entirely feasible."

Ko then shifted the focus to Taiwan's technical capabilities, emphasizing Taiwan's advantages in cryptography and information security. He gave examples, saying: "Taiwan has teams that rank among the top in international cryptocurrency competitions, cryptography hacker competitions, and even white hat hacker competitions. This is not a coincidence, but the result of Taiwan's long-accumulated talent and technical capabilities." He mentioned that the participants in these competitions often come from Taiwan's universities, research institutions, and startups, demonstrating that Taiwan's research and development capabilities in blockchain and encryption technology have already reached international competitiveness. Furthermore, he cited the example of the Taiwanese cryptocurrency company Cybavo being acquired by the internationally renowned company Circle as further evidence. "The fact that Cybavo's technology was recognized and acquired by Circle is not only a recognition of a single Taiwanese company, but also a recognition of Taiwan's overall technological ecosystem. Our talents have already become an important part of the global blockchain industry chain."

Regarding the role in the financial industry, Ke Ru-jun believes that Taiwan's traditional financial institutions also have the opportunity to shine in the field of digital currencies. He said: "Taiwan's banks and financial holding companies have decades of experience in traditional financial asset management. If they can transform this professional knowledge into custody and management services for digital currencies, they will be able to build a powerful 'Cryptocurrency Mountain Range'." He explained that the concept of the "Cryptocurrency Mountain Range" refers to a protective system composed of technological and financial infrastructure, which makes Taiwan's digital assets both secure and competitive.

He added that the government's attitude towards digital currencies has undergone a shift in recent years, from past caution or even skepticism, to a willingness to explore their potential, which is a commendable trend. For example, the Financial Supervisory Commission and the Central Bank have begun to study the regulatory framework for virtual assets, which provides a policy basis for incorporating Bitcoin into the national reserves.

Ke Ru-jun concluded that Taiwan has the conditions to make Bitcoin a national reserve in terms of technology, talent, and financial infrastructure, and the technical difficulty of preserving and managing Bitcoin is not a problem, and the promotion of industrialization is imperative. He suggested that the government should further encourage the financial industry to participate in the custody and innovative services of digital currencies, and formulate clear policy directions to enhance Taiwan's position in the global cryptocurrency market. "This is not only a technical issue, but also a key step for Taiwan to seize the financial opportunities of the new era."

Regarding the tax issues of cryptocurrencies, do you think taxation is beneficial or detrimental to the industry's development?

Regarding the tax issues of cryptocurrencies, Ke Ru-jun's position is very clear: the essence of taxation should be to promote industry development, rather than simply to increase government revenue. He said: "What is the purpose of taxation? It is not to let the government take a share from the emerging industry, but to use the tax revenue to benefit society, improve people's living environment, and support the long-term growth of the industry." He believes that if the government can demonstrate sufficient understanding of the cryptocurrency industry and provide substantial support through policies, such as subsidizing technology research and development, cultivating talents, or establishing international cooperation channels, then appropriate taxation is acceptable, and even beneficial. "People are willing to pay taxes because they believe the money can make the industry environment better. But if the government only wants to regulate and is unwilling to develop, why should the industry pay money to it? This is like strangling oneself, and no one will accept such logic."

Ke Ru-jun then talked about the government's fluctuating attitudes in different stages of the cryptocurrency market, which he believes is a hidden concern for industry development. He gave an example: "During the bear market, the government often sees cryptocurrencies as worthless things, and the central bank even issues warnings to the public, saying that Bitcoin is worthless, making people feel it is just a speculative bubble. But when the market becomes bullish, or when someone like Trump proposes to use Bitcoin as a strategic reserve for the United States, the government suddenly changes its attitude and thinks it has value, and starts discussing taxation." He questioned the logic of this stance: "If the government thinks Bitcoin is worthless during the bear market, why tax it during the bull market? If the market turns bearish again, will the government say it's not taxable anymore? This inconsistent policy will only confuse the people and the industry, and it is difficult to establish long-term trust."

He further suggested that before discussing taxation, the government should first demonstrate a strong determination to develop the cryptocurrency industry. For example, the government can set up a dedicated unit, provide tax incentives for startups, or encourage financial institutions to participate in the application of blockchain technology, to lay the foundation for the industry. "Taxation should not be the goal, but a means to promote industry development," he emphasized.

Ke Ru-jun stressed that "if the government does not have sufficient industry support plans and lacks in-depth understanding of this field, it would be highly irresponsible to hastily push for tax policies." He believes that Taiwan should learn from the experiences of other countries, such as Singapore or Switzerland, which have adopted flexible and supportive attitudes towards taxation and regulation, successfully attracting global cryptocurrency companies to set up operations.

As a legislator, what are your views on promoting a dedicated cryptocurrency law? Do you have any specific frameworks or bills in preparation?

When answering this question, Ke Ru-jun first elaborated on the relationship between legislation and execution, emphasizing the importance of coordination between the Legislative Yuan and the executive branch. He said: "The responsibility of the Legislative Yuan is to enact laws and oversee the government, but the ultimate effectiveness of any bill depends on the execution capability of the executive branch. If we unilaterally push for a cryptocurrency-specific law, even if the bill is passed through the three readings in the Legislative Yuan, the executive branch may raise objections or be unprepared, causing the policy to be stillborn." He gave an example that in the past, Taiwan's legislation in certain emerging fields had failed to be effectively implemented due to the passive attitude of the administrative departments, which is a situation he hopes to avoid.

Ke Ru-jun then pointed out that the current social and governmental understanding of cryptocurrencies in Taiwan is still not mature enough, which makes the timing for promoting a dedicated law not yet ripe. He said: "The current situation is that when many people hear about cryptocurrencies, their first reaction is still fraud or speculation, rather than seeing it as a technology or financial tool. The government is the same, although the Financial Supervisory Commission plans to set up a Financial Innovation Office, the personnel responsible for virtual currencies are scattered in different departments, indicating that the government itself does not yet have a unified definition and framework." He believes that in such a situation, hastily enacting legislation may lead to a disconnect between the regulations and actual implementation, and even trigger unnecessary controversies. "If the law is too strict, the industry will feel constrained; if it's too loose, it may be criticized as irresponsible. So the timing and preparatory work are very important."

As an opposition party legislator, Ke Ru-jun revealed that he and his team have indeed been researching the possibility of relevant bills, and have prepared some preliminary frameworks. "If necessary, we will propose our own version, with content that will incorporate more encouraging and positively open elements for the industry,"

He said, "For example, we will specifically define the scope of decentralized technology to avoid over-regulation that stifles innovation; at the same time, we will also consider how to protect consumer rights and encourage financial institutions to participate in the development of digital currencies." However, he emphasized that they will not act rashly before the timing is ripe. "The success or failure of the bill depends not only on how we write it, but also on how the government implements it. If the administrative unit does not have a cooperative mindset, even the most perfect law is just empty talk."

Ge Rujun suggested that the government should start from within, such as setting up a cross-departmental task force to unify the understanding of cryptocurrencies, and communicate fully with the industry. "When the social consensus is sufficient and the execution conditions are mature, then promote the special law, the chance of success will be higher," he said, "Taiwan has the opportunity to establish its own characteristics in this field, but the premise is not to be eager for success."

What are your views on the VASP special law? Do you support the promotion of the FSC's version of the proposal?

Regarding the VASP special law, Ge Rujun's attitude is cautiously optimistic. He believes that if this special law can be formulated together with the industry, and implemented by officials with a technical background, it will have a positive impact on the development of Taiwan's cryptocurrency industry. "The core of the VASP special law is to regulate virtual asset service providers, such as exchanges or wallet services, which is indeed an international trend and can also improve the transparency and security of the market," he said, "but the key is in the execution. If the government can find the right people and use the right methods, this will be a good thing."

However, he also expressed some concerns, especially the lack of professional talents within the government. "The current situation is that many of the people responsible for supervision still have a shallow understanding of blockchain technology. If the special law is pushed too quickly, they may formulate unrealistic regulations or over-regulate, which will end up stifling innovation."

He gave an example: "Like the government's previous warning about KOL's promotional behavior, this was originally to prevent fraud, but the interpretation of the law is too broad. If it is strictly enforced across the board, even normal marketing promotions may be prohibited, which would be a huge blow to the industry's development. The regulatory agencies, such as the FSC or the Ministry of Science and Technology, recruit experts in the cryptocurrency field, but the monthly salary is set at more than 50,000, and they are prohibited from making any personal investments. Will this attract talent?"

Ge Rujun argued that it is not appropriate to push the VASP special law before the government is fully prepared. "My suggestion is to first spend time on communication and education, so that the government can establish a technical understanding within, and then work with the industry to formulate rules that everyone recognizes," he said, "The government needs to have an open mindset, sufficient professional knowledge, and appropriate talent to implement these policies, otherwise even the best laws may be misused and become a burden on the industry." He emphasized that Taiwan has excellent technical talents and developer communities. If the government can cooperate with these forces and formulate forward-looking regulations, it will help Taiwan occupy a leading position in the global cryptocurrency market.