Cathay Securities has obtained approval from Taiwan's Financial Supervisory Commission (FSC) to issue biannual tokenised green bonds valued at $US930,000.

This marks the first time a firm has been granted a licence for a security token offering (STO) by the country's regulatory body.

The "Sunshine Green Yield" STO bonds have a six-year term, offering an initial annual interest rate of 3.5% and an initial principal amount of 30 million New Taiwan dollars.

These tokens enable business owners to purchase environmentally friendly electricity under favorable terms for environmental, social, and corporate governance objectives.

Cathay Securities claims to have developed Taiwan's first STO evaluation model, ensuring a 95% accuracy rate in predicting the potential default of small and medium-sized businesses.

Trading for the Sunshine Green Yield bonds is set to commence on December 12 via Cathay's proprietary STO exchange platform.

In March, the FSC confirmed its intentions to regulate cryptocurrency in Taiwan. Historically, the country has maintained a relatively hands-off approach to cryptocurrency regulation, primarily overseeing the asset class within the context of anti-money laundering measures.

The regulatory perspective shifted following the collapse of FTX, adding urgency to Taiwan's regulatory agenda. Taiwanese users were among the most prominent users of the exchange on a per capita basis, drawn to the platform due to its comparatively higher interest rates for U.S. dollar deposits in contrast to rates offered by local banks.