Philippines Moves towards Bitcoin Legalization as Securities

So far, opinion on bitcoin and other digital currencies tends to vary from country to country. While some are considering various forms of legalization, others are either denying its existence, or looking for ways to crack down on the coin. The most recent positive case is the Philippines, which is reportedly preparing the legalization of bitcoin through regulation.

With this in mind, the Commissioner of the Philippines’ Securities and Exchange Commission (PhSEC), has stated that the country will consider digital currencies as securities, hence apply the Securities Regulation Code as the main regulatory framework. This decision comes after thorough consideration, central bank consultation meetings and monitoring of bitcoin, according to the representative.

In a recent press statement, Commissioner Emilio Aquino mentioned that: “The direction is for us to consider this so-called virtual currencies offerings as possible securities in which case we will apply the Securities Regulation Code.”

Apparently, the country’s financial regulator has also been studying Initial Coin offerings (ICOs), and has developed a plan for action for the crowdfunding tool as well. According to the commissioner, “This initial coin offering, depending on the facts and circumstances in which the offering is made especially in raising capital, may be considered as securities, in which case they cannot just be offered without registering with SEC.” This is slightly bad news for companies in the region who are looking for ways to raise funds via ICOs, as this means that they will have to abide by more regulation. However, it is believed that positively regulating ICOs can have a positive impact on the market, but also on investors, considering the fact that scams can be prevented.

According to the commissioner, the country will be following a similar direction when compared to its economic partners, such as Thailand, Hong Kong and Malaysia.

Additionally, he also mentioned that he has had several discussions with the Central Bank of the Philippines, Bangko Sentral ng Pilipinas. He therefore mentioned that the governor of the bank also has an open-minded approach towards digital currencies, therefore regulation that helps provide innovation opportunities will also be considered.

The Central Bank stated that: “Today, there are two virtual currency exchangers registered with the BSP and several more are under evaluation.” Positive regulation will ensure that more companies will consider setting the Philippines as their headquarters, hence increasing the chances for the country in becoming a digital currency hub in the region.

It is important to point out the fact that the BSP recently issued a couple of regulations for digital currency exchanges, meant to combat money laundering.