Philippines Crypto Industry set to Evolve following ICO Legislation
The Philippines’ Securities and Exchange Commission (SEC) will shortly announce draft rules to regulate the country’s crypto-industry. As reported by The Manila Times, the proposed legislation could allow cryptocurrency exchanges to operate as trading platforms in the Philippines.
Ephyro Luis Amatong, the SEC Commissioner, stated that the regulatory body had recognized the need to regulate crypto exchanges as trading platforms. This draft regulation will, no doubt, play a significant role in establishing the Philippines as a major player in the cryptocurrency sphere.
Bangko Sentra ng Pilipinas (BSP), the central bank of the Philippines, has been active in implementing regulations for the cryptocurrency space. The two main financial organs of the country - the SEC and the BSP - have joined hands to regulate Virtual Currency Exchanges (VCEs), as Mr. Amatong explains:
“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 [cryptocurrency exchanges] engaged in trading.”
Earlier in the year, the central bank stated that it was reviewing applications from some VCE firms to conduct their operations in the Philippines. Currently, there are only two VCEs licensed with the BSP - Rebittance Inc. and Betur Inc.
Melchor Plabasan, deputy director of the BSP, went public with his pro-cryptocurrency views back in 2016 by stating, "If you want something that is fast, near real-time and convenient, then there’s the benefit of using virtual currencies like Bitcoin.”
In August, the SEC released proposed rules on initial coin offerings (ICOs), which will be finalized later this month. The rules stated that any entity that intends to conduct an ICO should file an initial assessment request with the regulator, explaining the offer. The SEC will then take a call on whether the issue of the security can take place or not.
Start-ups will have to register themselves as corporations if they wish to conduct an ICO, and issuers based outside the Philippines will have to register a branch within the country.
Exemptions will be limited and will only be allowed if the offering is made to 20 people or less during a period of one year and other entities such as banks, insurance firms, state-owned pension funds and more.
Small and medium-sized enterprises will seek to benefit immensely as they raise funds for expansion. This point was further advocated by Amatong, saying, “part of the promise is technology will allow smaller companies to raise funds in a safe manner.”
Mr. Amatong concluded by commenting on the effect that the new legislation will have on the Filipino market - “you have a way to look for investors without going through the whole process of a security.”
Image via Shutterstock
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