1. Introduction

On October 15, 2025, Mandopop superstar Jay Chou posted two consecutive updates on Instagram, angrily denouncing renowned Taiwanese magician Tsai Wei-tse for disappearing from public view, stating, "If you don't show up, you're finished," before unfollowing Tsai, sparking a trending topic. According to public reports, several years ago, Jay Chou entrusted NT$100 million (approximately RMB 23 million) to this magician friend for the purchase and management of Bitcoin, but the friend has since disappeared, and the assets are unaccounted for. Both individuals involved in this incident are Taiwanese citizens and subject to Taiwanese tax laws. Jay Chou's entrustment of Bitcoin to his friend was unrelated to tax evasion; it's highly likely that the former, due to the professional barriers in the cryptocurrency world, entrusted the latter out of trust.

The nominee shareholding arrangement involved in this incident, where a principal entrusts the management of their assets to a nominee, is particularly common in the cryptocurrency investment field. Nominee shareholding often brings systemic tax and regulatory risks to the parties involved due to the complexity of the parties and the variety of taxes involved. This article uses Jay Chou's nominee shareholding arrangement for cryptocurrency as an example, focusing on Taiwan's cryptocurrency tax policies and latest developments, providing a comprehensive analysis of nominee shareholding arrangements for cryptocurrency in Taiwan, and offering reference for cryptocurrency investors.

2. Taiwan's Cryptocurrency Tax Policy and Latest Developments

2.1 Overview of Taiwan's Cryptocurrency Tax System

Currently, while Taiwan has established a preliminary tax framework for crypto assets, it remains somewhat vague. On one hand, Taiwan has not yet clearly defined the nature of crypto assets through specific legislation. According to Order No. 1080321164 issued by the Financial Supervisory Commission (FSC) in 2019 and a joint statement issued by the FSC and the Central Bank of Taiwan on December 30, 2024, Taiwan considers virtual currencies such as Bitcoin to be non-currency, lacking legal tender status, and possessing unstable value, thus belonging to highly speculative virtual commodities. In terms of classification, it distinguishes between crypto assets with securities attributes and ordinary crypto assets. On the other hand, Taiwan lacks specific tax regulations for crypto assets, relying mainly on the extension of existing tax laws. Unlike the United States and Germany, which levy capital gains tax on crypto income, individuals and businesses in Taiwan are required to pay income tax on crypto asset transactions. This is similar to the treatment in India and Japan, where crypto asset income is classified as ordinary income and subject to income tax.

2.2 Overview of Crypto Asset Regulation in Taiwan

Taiwan's regulatory policies on crypto assets are not static. In the past two or three years, with the expansion of the crypto market and global regulatory trends, the Taiwanese authorities have gradually aligned their regulatory policies and measures with international standards while also seeking innovation. Starting in 2021, the Financial Services Commission (FSC) and Taiwan's financial authorities successively issued a series of guidelines, marking a transition from "no regulation" to "limited regulation." In 2021, the FSC brought virtual currency platforms under the jurisdiction of anti-money laundering regulations, requiring platforms to implement transaction monitoring and reporting obligations. While this measure did not directly involve taxation, it laid the foundation for subsequent tax audits. In 2022, Taiwan's financial authorities mentioned in their annual tax plan that they would strengthen the review of crypto asset transactions by high-net-worth individuals, focusing on combating tax evasion. In September 2023, the FSC released the "Guiding Principles for the Management of Virtual Asset Platforms and Trading Businesses (VASPs)" (hereinafter referred to as the "Guiding Principles") as a reference for businesses to operate in compliance with regulations. The "Guiding Principles" regulate the business operations of VASP practitioners based on the Anti-Money Laundering Act.

In 2024-2025, the Financial Services Council (FSC) and Taiwan's Ministry of Finance made further substantial progress in research and development of cryptocurrency tax policies. In 2024, the FSC announced that the Virtual Asset Services Act would be submitted to the Legislative Yuan in June 2025 to complete the legislative process; currently, the drafting of this law is underway. On January 13, 2025, Taiwan's Ministry of Finance submitted a written report to the Legislative Yuan's Finance Committee on "Regulations for Taxation of Cryptocurrency Income," clarifying the tax framework for cryptocurrencies in Taiwan. In July, the Legislative Yuan's Legal Affairs Bureau released a special research report on cryptocurrencies—"A Research Report on Cryptocurrency Tax Regulations from Legal, Policy, and Global Practice Perspectives"—which pointed out that while Taiwan has moved from a wait-and-see approach to the substantive inclusion of cryptocurrencies in its taxation scope, it still lacks clear legislative regulations and implementation details. The report recommended that Taiwan's Ministry of Finance should draft a special chapter on virtual asset taxation or enact a dedicated law.

In summary, recent policy developments indicate that Taiwan's tax policies on crypto assets are becoming more standardized and regulated, both in terms of legislation and implementation, aiming to provide a fairer and more transparent market environment for the development of the local crypto asset industry.

3. Tax and Regulatory Risks Analysis of Crypto Asset Holding on Behalf of Others in Taiwan

Returning to the current incident, the Bitcoin holding dispute between Jay Chou and his friend, seemingly a simple civil agency contract dispute, profoundly reveals the recognition dilemmas and compliance risks faced by crypto assets under traditional tax law frameworks. Under Taiwan's current tax system, such holding arrangements may trigger multiple tax burdens, including comprehensive income tax and gift tax, and are also subject to the risk of thorough investigation by tax authorities due to the application of the "substance-based taxation principle." With the FSC's push for the "Virtual Asset Services Act," the transparency requirements for crypto asset transactions will significantly increase, and this traditional asset holding method will face unprecedented tax challenges. To specifically discuss the tax and regulatory risks involved in holding arrangements, it is necessary to start from the current legal provisions in Taiwan to discuss the tax classification, tax calculation, and related regulatory issues of crypto asset holding arrangements.

3.1 Taxes Involved and Legal Basis

3.1.1. Comprehensive Income Tax

According to the written report "Regulations on Taxation of Cryptocurrency Income" (Taiwan Finance and Taxation Document No. 11304672340), income from the sale of non-securities virtual currencies (such as Bitcoin and Ethereum) is classified as "income from property transactions." Therefore, regardless of how Jay Chou's funds flow back, income tax will inevitably be triggered during the sale of Bitcoin to realize profits. This is the most tax-intensive and certain part of the entire transaction. According to Article 14, Paragraph 1, Category 7 of Taiwan's "Income Tax Law," the formula for calculating the comprehensive income tax arising from nominee shareholding is: Taxable income = Total sales revenue - Original acquisition cost - Necessary expenses. For a huge income of nearly NT$200 million, the highest tax rate of 40% will almost certainly apply, and the tax payable = Taxable income × 40%. From the perspective of tax liability, if the nominee is the nominal holder in a nominee shareholding arrangement, but the actual beneficiary is the principal, the tax liability may belong to the principal. However, if the nominee disposes of the assets without authorization, the tax liability may become unclear.

3.1.2. Gift Tax

Nominee shareholding may involve the transfer of funds. In the absence of sufficient evidence to prove that it is a "trustee investment" relationship, the transfer of funds may be presumed by the tax authorities to be a "gratuitous gift." According to Article 4, Paragraph 2 of Taiwan's "Inheritance and Gift Tax Act," "A gift, as referred to in this Act, means an act in which the owner of property gratuitously gives his or her property to another person, which becomes effective upon the acceptance of the other person." If a rigorous nominee shareholding agreement, explanation of fund transactions, or other documents cannot be provided, the tax authorities have the right to determine, based on substantial economic facts, that the "principal" has gifted funds to the "nominee," thereby levying gift tax. Specifically, in terms of calculation, according to Article 19 of the Act, "Gift tax is calculated on the net amount of the gift after deducting the deductions stipulated in Article 21 and the tax exemptions stipulated in Article 22 from the total amount of the gift given by the donor each year," a progressive tax rate of 10% to 20% applies. Since the asset amount in this case clearly exceeds NT$50 million, a progressive tax rate of 20% should apply. The calculation formula is: Tax payable = (Total amount of donation - Tax exemption of RMB 2.2 million - Deduction) × 20%.

3.2 Tax and legal risks associated with nominee shareholding

In recent years, Taiwan's cryptocurrency tax policy has gradually moved from temporary guidelines to dedicated legislation. The Legislative Yuan has explicitly recommended enacting a special tax law to resolve many ambiguities under the current framework, such as disputes over profit and loss offsetting, whether unrealized gains are taxable, and cost determination. In terms of implementation, there is also a gradual push to strengthen information transparency and tax source control. This is particularly evident in the "Virtual Asset Services Act" being drafted by the Financial Supervisory Commission (FSC). The core of this law is the establishment of a platform registration system and strengthened information reporting mechanisms. This will greatly enhance the tax authorities' ability to obtain transaction data, meaning that future compliance pressures will significantly increase. This suggests that investors should closely monitor announcements from the FSC and Taiwan's financial authorities and adjust their strategies accordingly. For example, if a platform reporting system is implemented in the future, nominee shareholding activities may be more easily investigated.

Furthermore, nominee shareholding arrangements for crypto assets involve complex tax and regulatory issues in Taiwan. Besides potentially imposing additional tax burdens on investors, it could also result in asset losses. Article 7 of Taiwan's "Taxpayer Rights Protection Act" explicitly states that the taxpayer is the one who actually receives the income, reflecting the principle of substantive taxation. In a nominee shareholding arrangement, although the assets are registered in the nominee's name, if the actual investment, profit attribution, and disposal rights belong to the principal, the tax authorities can determine that the principal is the actual right holder and require them to fulfill their tax obligations. In Jay Chou's case, if the nominee shareholding relationship cannot be proven, the tax authorities may levy taxes on the nominee, resulting in asset losses for the principal. If nominee shareholding is indeed necessary, investors need to proactively declare gains from crypto assets as required, retain complete transaction records, and sign a written agreement clearly defining the rights, obligations, and tax responsibilities of both parties.

4. Conclusion

Jay Chou's case is not an isolated incident, but rather a mirror reflecting the risks of nominee shareholding in crypto assets, revealing the systemic risks of such practices under Taiwan's legal and tax framework. While the world of crypto assets champions decentralization and anonymity, the centralized responsibility for tax compliance remains firmly anchored on every investor. Faced with risk, superstars are no different from ordinary crypto investors; how to control potential tax and legal risks is a topic worthy of long-term attention.