Recognising the global interest in cryptocurrencies, there are reports out of the Philippines to regulate cryptos. The Manila Times reports that the Securities and Exchange Commission (SEC) of the Philippines is targeting to release draft rules this month.
The move comes at a time when most Asian countries are shunning the asset class Many countries have cited the instability of value and very high volatility of the digital assets as dangers to avoid. However, other countries like the Philippines are aware of the virtual currency’s potential for growth and are embracing it.
According to the media reports, the Philippines will use the existing regulatory framework pioneered by Australia and Switzerland.
The local SEC is looking towards a cooporative relationship with the country’s central bank, the Bangko Sentral ng Philippines (BSP). According to Ephyro Luis Amatong, an SEC Commissioner, the two institutions have similar interest in the sector.
On regulatory future and the relationship with the BSP, he said:
“We see the need to regulate them as trading platforms. We already discussed the matter with the BSP since the BSP is also interested and we are also interested. The discussion… [involves] joint cooperative oversight over (virtual currency exchanges) engaged in trading.”
Further, the BSP indicated a dire need for regulations in a communication elaborating on Virtual Currency Exchanges (VCEs). According to the statement, the VCEs as currently defined do not meet the security needs to guarantee investors’ safety.
The move by Philippines to regulate cryptos targets to inspire investors’ confidence
In the communication, the BSP conveyed, “VCEs are required to have security measures and safeguards to address the risks associated with digital currency exchanges, such as basic controls on anti-money laundering and terrorist financing, consumer protection, and technology risk management.”
The SEC Commissioner and the BSP all point towards a need to create a transparent and secure business environment. The desire for Philippines to regulate cryptos hopes to achieve a first mover advantage in the region.
Early this month, the SEC released similar regulations for initial coin offerings segment in the country. The set of rules will go live pending “a public feedback model to assess their potential.”