The Bangko Sentral ng Pilipinas (Central Bank of the Philippines) has recently approved two new cryptocurrency exchanges, as reported by Business World, one of the country’s prominent business newspapers.
Chuchi Fonacier, BSP’s deputy governor, noted that the applications of Virtual Currency Philippines, Inc. and ETranss have been accepted as platforms. These exchanges enable them in converting Philippine pesos into any virtual currencies. Such development makes the two exchanges to be part of the currently existing exchanges in the country such as Rebittance, Inc., Betur, Inc., and Bloom Solutions.
BSP has shown optimism in the potential role of digital currencies to achieve quicker and more affordable transactions. However, it has warned the public of possible risks of volatility, fraudulent transactions, and cybersecurity.
Earlier, BSP was considering whether the two exchanges should be categorized as e-money issuers since they provide their clients with wallet services. Fonacier stressed based on the recommendations on internal consultations, it is not necessary for this requirement to provide a better registration process for new market players.
She added the Bank is refining the rules. If the new exchange’s business model is partly using e-wallet, then it will be an added requirement but not right away an e-money license.
The Anti-Money Laundering Council will implement stringent measures regarding digital currency transactions with its main goal of tracking down all sources of fraud and illegal activities. Companies are forced to report all their transactions and other suspicious activities.
For the past several years, Business World reported that conversion of the Philippine peso to digital currencies has notably increased. During the first quarter last year alone, about $36 million per month for their transactions was recorded from these two exchanges.
In April, the Philippine government said around 10 blockchain and crypto firms will be allowed to operate in the Cagayan Economic Zone. The new firms are set to provide jobs for local residents in exchange for tax breaks.
The Cagayan Economic Zone Authority seeks the new firms to make about $1 million investment for two years and generate an income of $100,000 in license fees.
In November 2017, the country’s Securities and Exchange Commission noted the agency will legalize the use of digital currencies in the country. These currencies will be classified as securities. Earlier, BSP has recognized Bitcoin as a legal payment system.