Federal Bank's investment in MaiCoin falls through! Reasons for FSC's rejection revealed

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Union Bank's direct investment in MaiCoin rejected by FSC Union Bank's board of directors resolved last August to acquire 5.356 million shares of Modernity Financial Holdings, Ltd, the offshore holding company of Taiwan-based virtual asset service provider MaiCoin, for a total of USD 27.817 million (approximately NTD 850 million), representing a stake of about 9.67%. The plan also originally involved transferring all shares held by its subsidiary, Union Venture Capital, to the bank. However, Union Bank announced on May 11 that, following an interpretation by the Financial Supervisory Commission (FSC), it was determined that MaiCoin's offshore holding company is not a finance-related business and lacks substantive operations; therefore, the direct investment will not be executed. Union Bank stated that this change has no material impact on the company's finances or operations. Article 74 of the Banking Act is the key to the FSC's rejection The main point of contention regarding the rejection of Union Bank's direct investment in MaiCoin is the regulation under Article 74 of the Banking Act. The article stipulates that commercial banks must obtain approval from the competent authority to invest in either finance-related or non-finance-related businesses, and the investee must possess substantive operational facts. If the investment target is a non-finance-related business, the bank's shareholding ratio must not exceed 5% of the company's issued shares by law. After internal discussions, the FSC determined that Modernity Financial Holdings, Ltd, an offshore holding company established in the Cayman Islands, is not a finance-related business and lacks substantive operations, thus failing to meet the investment prerequisites of Article 74 of the Banking Act. Union Bank steadily enters the crypto space, holding custody business and co-branded cards Following the FSC's promotion of the draft Virtual Asset Service Act and the Virtual Asset Service Provider (VASP) licensing system, Union Bank is one of the more active banks in the crypto space. Not only did it officially launch virtual asset custody services in September 2025, becoming the first financial institution in Taiwan to be approved for such operations, but it also recently launched the first credit card featuring cryptocurrency rewards, where cardholder rewards can be directly converted into virtual currencies such as Bitcoin, ETH, USDT, and $USDC. Union Bank President Hsu Wei-wen stated at a recent press conference that he believes the bank's virtual asset custody business will be promoted in four stages. The initial phase focuses on assets from trading platforms, followed by expansion to professional institutional investors and high-net-worth individuals, with the ultimate goal of eyeing potential custody needs for crypto ETFs that may be issued by investment trust companies in the future. Although Union Bank's attempt to directly invest in MaiCoin has fallen through, according to reports from the Economic Daily News and Commercial Times, even without direct equity participation, it is understood that the investment plan will be carried out by personal affiliates of Union Bank's major shareholders, and the existing cooperation model between the two parties is expected to remain unaffected. Union Bank also emphasized that it absolutely respects the determination of the competent authority. (The above content is excerpted and reprinted with authorization from our partner Crypto City; original link)

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FSC rejects Federal Bank's investment in MaiCoin's parent company: Lack of operational substance violates Banking Act, alternative plan adopted

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Source:區塊客

Published:2026-05-13 12:14:09

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