Philippines Crypto Service Providers Prepare for New SEC Regulation

The Securities and Exchange Commission (SEC) of the Philippines has put forth a new set of rules called the “SEC Rules on Crypto-Assets Service Providers (CASP Rules)” and they’re looking for the public’s input. This move is all about setting up a solid framework to regulate the fast-growing crypto-asset market in the Philippines.

The Philippines has become a hotspot for cryptocurrency, thanks to a tech-savvy population with an average age of 25.3 years. With over 562 million global users of crypto-assets, it’s important to have regulations in place to protect against fraud and market manipulation.

These proposed CASP Rules are designed to protect investors, encourage innovation, and meet international standards set by organizations like the International Organisation of Securities Commissions (IOSCO). They define crypto-assets as digital value representations that rely on distributed ledger technology and cover activities like offering, trading, and custody.

All crypto-asset service providers in the Philippines will need to register with the SEC and get a license that meets strict criteria, including compliance with the Financial Products and Services Consumer Protection Act (FCPA) and minimum capital requirements.

When it comes to public offerings of crypto-assets, the rules are strict. Companies must submit detailed disclosure documents to the SEC at least 30 days before any marketing activities. These documents need to include info about the company, the technology, risks involved, and potential losses for investors.

The rules also focus on preventing financial crimes, like money laundering, and stopping market manipulation and insider trading. Cybersecurity is also a big deal, with providers needing to have top-notch measures in place aligned with the National Cybersecurity Plan. Regular audits will make sure they’re up to scratch with the latest threats.

Overall, these proposed rules are a big step toward creating a safe, transparent, and sustainable environment for crypto-asset activities. While they might be tough for smaller companies to meet, they show the SEC’s dedication to protecting investors and keeping the market fair.

If you want to have a say in these rules, you can submit feedback until January 18, 2025. This collaborative approach will help finalize the regulations and set the tone for the Philippines to lead the way in the global crypto economy. The CASP Rules aim to strike a balance between innovation and regulation, supporting sector growth while ensuring consumer protection and fair market practices.