The government of the Philippines is taking steps to become a crypto hub and is now expanding its regulatory scope to include custody services. This week, local news sources confirmed that Bangko Sentral ng Pilipinas (BSP), the country’s central bank, had developed a broad licensing regime for crypto firms in the country.
Another Milestone Reached
First reported by the Philippine Daily Inquirer, the new regulation requires crypto firms operating in the Philippines to register their services with the BSP. The regulatory scheme applies to trading firms, custody firms, and even brokerage services.
Along with registration requirements, the BSP is also asking that all crypto firms in the country comply with global Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF) rules. Thus, it is working on an appropriate threshold from which all crypto transfers need to go through identity verification steps – for originating accounts and beneficiaries.
Benjamin Diokno, the BSP’s Governor, explained that the expanded regulatory regime would be instrumental in ensuring that the Philippines can tag along as the global crypto space continues on a developmental trajectory.
He explained that the updated regime would eliminate any loopholes that have been present in the country’s crypto policies, which began in 2017 when the BSP issued guidelines for crypto-to-fiat trading pairs.
The new rules will also help provide a healthier crypto and financing ecosystem, with the BSP focusing on improving innovation while also protecting investors.
Moving Towards a Digital Future
The Filipino government has been doing impressive work in the crypto space for a while now. Its acceptance has grown significantly, as it hopes to catch up to several Asian countries like Singapore when it comes to the digital asset revolution.
Last September, Diokno told Bloomberg that the BSP had seen enough to recognize and legitimize digital tokens and their use in the country. As the policymaker told the news source, digital tokens can expand the reach and delivery of financial services in the country, while also reducing costs and allowing the economy to move away from fiat currency use.
The BSP has also committed to studying a potential Central Bank Digital Currency (CBDC), joining a financial fervor that gripped several of the world’s leading economies last year. In July, Bloomberg reported that the BSP had formed a committee to examine the potential of moving to a digital currency full-time.
Diokno explained that the group was looking into the feasibility of a CBDC launch, as well as the polity implications that such a move will bring. It is unclear what the results have been or what the BSP plans to do next