Thus, exchanges dealing in crypto-to-crypto trading pairs and custody platforms must now obtain approval from the central bank. The expanded regulatory regime also covers cryptocurrency derivatives platforms.
All crypto firms in the country will also have to comply with global financial best practices including Anti-Money Laundering and Countering the Financing of Terrorism. As a result, cryptocurrency transfers above a certain threshold will require identifying information for both the originator and beneficiary parties.
For Benjamin Diokno, governor of the BSP, the expanded regulatory regime is necessary to keep up with the pace of development in the crypto space over the last three years. Back in 2017, the BSP issued rules for exchanges involved in fiat-crypto trading pairs.
According to Diokno, the new rules will eliminate any regulatory loopholes in the crypto financial services ecosystem adding that the central bank is committed to striking a balance between its promoting financial innovation while maintaining its oversight responsibilities.
Back in 2020, the BSP reportedly began mulling the issuance of a central bank digital currency. However, the Philippines’ apex bank has come out to say that it is not ready to create a sovereign digital currency but is actively monitoring the scene.
Southeast Asia continues to be a global hub for open finance with a positive disposition to emerging technologies. Markets like Singapore and Thailand already boast a sophisticated electronic payment ecosystem.
As previously reported, Asia accounts for almost 50% of the global cryptocurrency trade.