The Securities and Exchange Commission (SEC) of the Philippines has introduced draft regulations aimed at governing cryptocurrency asset service providers, a move analysts believe could enhance investor protection and drive wider adoption of digital currencies in the country.
“This marks an important step toward a more organized and secure crypto landscape in the Philippines,” said Arlone P. Abello, founding chairman of the Innovative Movement of the Philippine Association of Crypto Traders, in an emailed response.
Abello, who also serves as chief executive officer at Global Miranda Miner Group, a crypto education platform, emphasized the importance of the proposed regulations. “The proposed rules are an important milestone in providing investor protection while creating a structure that can guide both new and established players in the crypto space,” he added.
According to Abello, the draft rules could significantly benefit traders by reducing risks and enhancing market transparency. “Clearer regulations will help prevent fraud, reduce risks for traders, and foster a more transparent market,” he said. He also noted that the regulations would ensure that traders have a better understanding of their rights and obligations, creating a safer environment for all participants in the growing crypto industry in the Philippines.
SEC Draft Rules Seek Comprehensive Oversight
The SEC’s draft regulations, issued on December 20, outline requirements for crypto service providers, including mandatory SEC registration as stock corporations, a minimum of four staff members residing in the Philippines, and compliance with capital requirements. The rules also aim to prevent market abuses such as manipulation, insider trading, and the misuse of nonpublic information.
Comments on the proposed rules will be accepted until January 18, 2025.
Jiro Luis S. Reyes, chief executive officer at crypto education platform Bitskwela, welcomed the initiative but highlighted the need for targeted educational support and clearer sub-classifications for crypto service providers. “I would like to stress the importance of support for educational efforts in the Philippines,” he said in an email.
Reyes also called for transparency on the SEC’s criteria for removing crypto assets from exchanges, expressing concern over the misuse of the phrase “in the interest of investor protection” in both local and international contexts.
Industry Advocates Seek Clarity
Nancy M. Ocampo-Omadto, chief legal counsel at Moneybees, a crypto over-the-counter service, noted a potential oversight in the draft regulations. She pointed out the absence of transitory provisions for existing virtual asset service providers registered with the Bangko Sentral ng Pilipinas (BSP).
Under BSP Circular No. 1108, issued in January 2021, cryptocurrencies are treated as virtual assets. However, a three-year moratorium on new virtual asset service provider licenses was imposed due to systemic financial risks. The moratorium is expected to be lifted next year.
As the Philippine crypto industry continues to expand, stakeholders hope the SEC’s proposed regulations will provide much-needed clarity and security, paving the way for broader adoption of digital currencies across the nation.
