In a move to prioritize investor protection and thorough research, the Philippines’ financial regulator has decided not to rush the publication of a legal framework for the crypto industry, which was initially planned for late 2022. While the regulatory authority is continuing its work on the guidelines, the decision to delay their release was influenced by market failures and the desire to understand the collapse of the FTX exchange. The chairman of the Philippines Securities and Exchange Commission (SEC), Emilio Aquino, expressed that the framework could still be issued by the end of 2023, emphasizing the importance of safeguarding investors. Meanwhile, the country has been experiencing growing pressure regarding the use of unregistered or foreign crypto exchanges, as highlighted by the central bank and the SEC. Despite these challenges, the Philippines remains an attractive destination for crypto enthusiasts, boasting a significant number of digital asset owners.
Amid a backdrop of market turbulence in 2022, the Philippines’ financial regulator, the Securities and Exchange Commission (SEC), has chosen a cautious approach in formulating a legal framework for the country’s crypto industry. Initially scheduled for release in late 2022, the publication has been postponed to allow for a comprehensive examination of the collapse of the FTX exchange and to ensure that the interests of investors are adequately protected. Chairman Emilio Aquino emphasized that the decision to delay the framework does not indicate a permanent abandonment but rather a commitment to prevent potential pitfalls and protect the public.
Aquino stated, “We haven’t closed the door. We really just have to make sure people don’t get burned.” This prudent approach underscores the SEC’s dedication to thoroughly understanding the risks associated with cryptocurrencies before establishing a regulatory framework that promotes a safe and secure environment for investors and market participants. Although the publication timeline has been extended, there is still a possibility that the framework will be issued by the end of 2023, provided all necessary precautions have been taken.
In collaboration with the University of the Philippines Law Center (UPLC), the SEC has been working diligently on crafting comprehensive guidelines for the digital asset industry. The partnership aims to ensure that the forthcoming framework encompasses the evolving nature of cryptocurrencies while addressing the concerns raised by market failures and potential risks. Earlier this year, the SEC released the Implementing Rules and Regulations of Republic Act No. 11765 for public commentary. Notably, the act itself does not explicitly mention “crypto” or “blockchain.” This step further demonstrates the regulators’ commitment to thorough analysis and consideration of various aspects before finalizing the legal framework.
As the Philippines faces mounting pressure regarding unregistered or foreign crypto exchanges, both the central bank and the SEC have repeatedly advised citizens against engaging in such operations. The recent categorization of Gemini Derivatives as an unregistered security product under national law further highlights the authorities’ efforts to ensure compliance within the crypto industry. These measures aim to protect investors and mitigate the risks associated with unregulated platforms.
Despite these challenges, the Philippines continues to attract crypto enthusiasts due to its thriving economy. It ranks among the fastest-growing economies globally and has a substantial number of individuals participating in the crypto market. Surpassing 11.6 million Filipinos owning digital assets, the country holds the 10th position worldwide in terms of crypto adoption. This remarkable statistic showcases the Filipino population’s growing interest and engagement with cryptocurrencies, even in the absence of a finalized regulatory framework.
Did you know that the Philippines is home to one of the largest remittance markets in the world? Overseas Filipino workers often rely on remittances to support their families back home. The adoption of cryptocurrencies in the Philippines has gained traction due to the potential for faster and more cost-effective cross-border transactions. By leveraging cryptocurrencies,
Disclaimer: This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments. This is a news article only.
