The Philippines continues to be a forerunner in crypto adoption, sustaining a place among the many main international locations. In accordance with blockchain intelligence agency Chainalysis, the nation presently holds the sixth rank, showcasing sturdy efficiency in each centralized and decentralized finance service worth. Though this means a slip from the earlier yr’s second place, business pioneers within the Philippines are optimistic, perceiving an elevated embrace of blockchain know-how by Filipinos, extending past cryptocurrencies.
Like a number of nations all over the world, the Philippines is progressing in direction of establishing a structured regulatory framework for cryptocurrencies. Nevertheless, the enactment of a digital property framework by the nation’s Securities and Trade Fee (SEC) has been deferred, attributed to the late 2022 collapse of FTX, a cryptocurrency alternate primarily based within the Bahamas.
Throughout Philippine Blockchain Week, Jenny Ortiz-Bolivar of Forkast engaged in an unique dialogue with Kelvin Lester Lee, the Philippine SEC Commissioner, delving into the company’s perspective on cryptocurrencies and digital property, the rampant rise of crypto scams within the nation, the collaboration initiatives with Southeast Asian international locations, and the enforcement actions undertaken by the U.S. SEC.
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The next Q&A has been edited for readability and size.
Jenny Ortiz-Bolivar: The (Philippines) SEC delayed the publishing of the nation’s crypto framework and the rationale that the company cited was the FTX collapse. What’s the newest growth on this? When can we count on the framework to be out?
Kelvin Lester Lee: We can have it out for public remark within the subsequent month or so. From there, we are going to see about implementation, whether or not on the finish of the yr or the primary or second quarter of subsequent yr, relying on suggestions from the general public. One message I’d wish to get out now’s: please await that draft when it comes out, please remark, and assist information us alongside on how one can transfer ahead with this.
We wish to ensure that the general public has buy-in in relation to this. We wish to ensure that the general public is prepared for this as properly, as a result of admittedly, the way in which we have been setting it up, we wish to defend most people. We wish to ensure that it’s not too prohibitive that companies corresponding to crypto platforms can not function.
I’m not saying we are going to regulate all cryptocurrencies. That’s not the path. We’ll assess and see which cryptocurrencies or digital property — as we are going to name them — can be working or may be thought-about as securities. That’s what we are going to regulate.
Ortiz-Bolivar: What’s the stance of the SEC on cryptocurrency, stablecoins, and different digital property corresponding to non-fungible tokens, or NFTs?
Lee: Cryptocurrencies as an entire, I’m open. We’re typically open to it as a result of we perceive that that is the subsequent step of the evolution in the case of the monetary system. We get that. So after all we wish to attempt to accommodate it, topic to acceptable legal guidelines.
Now, on the purpose of the NFTs, we are going to deal with the NFTs relying on how they’re used. If the NFT goes for use as an artwork type, then we go away it alone. However, if it operates and is attempting to be like securities, an actively traded digital asset, then clearly we’ll should deal with it someplace in a distinct method. That is, by the way in which, the mechanism that the Financial Authority of Singapore is utilizing.
I truly discovered that from them after I talked to my counterpart there and we have been having discussions on this earlier this yr they usually had guided me that that’s how they’re coping with NFTs. I believed we’d undertake one thing just like that in an unofficial capability. We didn’t come out with laws for this, however actually, that’s how we’re treating it as soon as the digital asset providing laws come out.
Ortiz-Bolivar: You talked about the MAS. Is there a collaboration between different regulators, and neighboring international locations? How is it?
Lee: Superb. Now we have one thing referred to as the ASEAN Capital Markets Discussion board. So, my counterparts within the ten completely different ASEAN international locations are a part of that and we collaborate often. We meet 4 instances a yr. The subsequent one is in Bali subsequent month. I’m the Philippine consultant to that and one of many agenda normally is dialogue on the completely different remedies and the completely different regulatory regimes we use for digital property and cryptocurrencies. That’s why our collaboration in relation to that’s steady and superb.
Ortiz-Bolivar: I wish to discuss concerning the U.S. This yr, the U.S. SEC performed what some business leaders name a crackdown on the crypto business. Would the Philippine SEC mirror the transfer?
Lee: Now we have superb relations with the U.S. SEC. Just some weeks in the past, the U.S. SEC truly despatched a delegation right here to coach our individuals on enforcement and how one can deal with not solely digital property however how one can deal with sustainable finance and completely different associated capital market laws. There are presently no plans to go that path, that means a crackdown.
We’re, nevertheless, supportive of the U.S. SEC’s place being a counterpart company, however we defer to how they do issues of their jurisdiction. In the identical manner, they’ll defer to us on what we do in our jurisdiction. Now, whether or not or not we are going to ever go right into a crackdown, will rely on what occurs with our native gamers. If there are abuses, then we’ll be compelled to do this.
Ortiz-Bolivar: One urgent concern within the Philippines now’s the proliferation of crypto scams – victimizing Filipinos and even utilizing them to be a part of it. The variety of victims and the amount of cash concerned are so alarming that it even reached the Senate flooring. What are you able to say about this? Is there an effort on the facet of the SEC to guard Filipinos from this?
Lee: Curiously sufficient, a number of these crypto scams are usually not typically crypto-related. They’re typically simply Ponzi schemes after which they simply use the crypto tag to make it sexier to the general public in order that they’ll make investments. We’ve performed raids, we’ve performed advisories, we’ve issued stop and desist orders towards completely different entities already in relation to that.
I’d wish to strongly emphasize to the general public: verify with the SEC earlier than you make investments or do something in relation to investing your cash, digital property, or no matter you name it. Please verify with the SEC so that you simply’ll know whether or not that firm exists or not, whether or not the corporate is actual or not, or whether or not the corporate is even registered within the Philippines. So be very, very cautious earlier than you make investments and verify with the SEC.
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