What are stablecoins? When will they be available in Taiwan? Can they be used to receive salaries?

Since the United States passed the GENIUS Act, which incorporates stablecoins into the financial system, regions are beginning to evaluate their own national currency stablecoins. The Financial Supervisory Commission stated that if the Virtual Asset Management Regulations are successfully legislated, the New Taiwan dollar stablecoin could be officially launched as early as June or July 2026. What exactly is a stablecoin? Can it be used to receive salaries? How does it differ from Bitcoin? This article provides comprehensive information to help you understand this financial tool that is about to change the payment ecosystem.

Taiwan Stablecoin Launch Timeline and Regulatory Status

The new Taiwan dollar stablecoin issuance planned by the Financial Supervisory Commission will be primarily led by financial institutions to ensure transparency and regulation of reserves. According to the draft Virtual Asset Management Regulations, stablecoin issuers must establish a 1:1 reserve ratio, collateralized by New Taiwan dollar cash or short-term government bonds, guaranteeing holders the ability to freely exchange. If legislation proceeds smoothly, Taiwan will become one of the first countries in Asia to establish a complete stablecoin regulatory framework.

The U.S. GENIUS Act stipulates a 1:1 reserve ratio for USD stablecoins, requiring issuers to back stablecoins with USD and short-term U.S. Treasuries to ensure holders can freely exchange. This model has become a reference for many countries. Taiwan’s plan largely follows similar logic but will include stricter participation thresholds for financial institutions to prevent private entities from issuing excessive stablecoins and causing systemic risks.

What is a stablecoin? Why doesn’t it skyrocket or crash?

What is a stablecoin? Simply put, a stablecoin is a type of cryptocurrency issued by private entities or financial institutions, designed to maintain a value close to 1 USD (or other fiat currencies). Unlike Bitcoin or Ethereum, which can experience large price swings, stablecoins aim to “stay stable,” providing a reliable store of value and medium of exchange in the crypto market.

Currently, 99% of global stablecoins are pegged to the US dollar or dollar assets. The two most well-known fiat-backed stablecoins are USDT (Tether, issued by Tether Limited) and USDC (issued by Circle, which applied for an IPO in the US in April 2025). These stablecoins are collateralized by USD cash or government bonds, directly linked to the dollar, and hold the largest market share.

The stability of stablecoins hinges on their collateralization mechanism. For each stablecoin issued, the issuer must hold an equivalent amount of USD or short-term government bonds as reserves. When users want to redeem fiat currency, the issuer pays from the reserves, ensuring the stablecoin always maintains a 1:1 value. This design makes stablecoins the “digital USD” or “digital New Taiwan dollar” in the crypto world.

Can I use stablecoins to receive salaries? 4 Practical Use Cases

Can I receive salaries in stablecoins? The answer is yes, and it’s already happening. As the Web3 industry grows, more multinational companies and remote workers are choosing to pay salaries in stablecoins, for reasons including:

Cross-border payments and remittance revolution: Not limited by bank hours, transfers can be completed 24/7, with settlement times reduced to within 10 seconds to 5 minutes, and transaction fees nearly zero. This also avoids exchange rate losses. Especially in emerging markets with volatile exchange rates, stablecoins have become a primary tool for cross-border payments for many companies and tech giants. A remote worker in Taiwan can receive USDC salary from their U.S. employer within minutes and convert it to New Taiwan dollars via exchanges.

Safe haven for crypto trading: During sharp fluctuations of Bitcoin and Ethereum, investors can quickly convert assets into stablecoins to temporarily avoid risks, without needing to withdraw to a bank, remaining within the crypto market to operate. This makes stablecoins the “digital cash” for crypto traders.

Core assets in decentralized finance (DeFi): Stablecoins serve as a bridge connecting traditional finance and DeFi, offering lending, trading, insurance, and interest-earning services. They are transparent, open, permissionless, enabling users to perform peer-to-peer financial operations directly.

Everyday spending and Web3 services: On crypto exchanges, stablecoins are often used as a pricing unit and for purchasing NFTs, blockchain games, and subscribing to Web3 services. In the future, stablecoins may penetrate daily consumption, global salaries, and trade settlement.

Quick comparison of the three main types of stablecoins: pros and cons

Fiat-collateralized

Advantages: Most stable, highest market share, best liquidity, easy to understand

Disadvantages: Requires trust in the issuer’s honesty in maintaining reserves, transparency of reserves often questioned

Examples: USDT, USDC

Crypto-collateralized

Advantages: Decentralized, high transparency, managed automatically via smart contracts

Disadvantages: Over-collateralization required (usually 150% or more), automatic liquidation when collateral prices plummet

Examples: DAI (now renamed USDS, maintained by MakerDAO, mainly backed by Ethereum)

Algorithmic

Advantages: No collateral needed, fully decentralized, theoretically infinitely scalable

Disadvantages: Most controversial and risky, prone to “death spiral” and complete collapse during market confidence crashes

Examples: Past Terra UST (now collapsed)

Buying and Usage Guide: How can ordinary people get started

Choose a secure, reputable exchange that supports stablecoin trading, open an account, and exchange New Taiwan dollars for USDT, USDC, or other stablecoins. These can serve as “cash” in the crypto world to buy other cryptocurrencies, NFTs, blockchain games, or Web3 services; or for cross-border transfers, which are faster than traditional bank remittances, not limited by business hours, with lower fees, and most importantly, reduce exchange rate losses.

Important Risks and Protective Tips

Reserve transparency risk: Fiat-backed stablecoins claim to hold 1:1 reserves, but external parties find it difficult to verify in real-time. If the market suspects insufficient reserves, panic selling may occur. Run risk: when many users simultaneously redeem for fiat, the issuer or system may be unable to meet demands, causing the price to temporarily or permanently deviate from 1 USD.

Regulatory risk: Regulations are still being adjusted in various countries, and sudden restrictions on issuance, circulation, or use may impact adoption. Smart contract and technical risks: crypto-collateralized and algorithmic stablecoins may be exploited due to bugs, oracle errors causing incorrect liquidations, or governance mistakes during upgrades, leading to disconnection from the peg.

Exchange platform and custody risks: Holding stablecoins on exchanges involves risks of platform insolvency or hacking; self-custody risks include irreversible loss of private keys. It is recommended to diversify storage, choose regulated exchanges, and regularly check issuer reserve reports.