Philippines Delays Crypto Framework for Protection of Investors

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• The Philippines’ financial regulator has decided to delay the release of its legal framework on the crypto industry, which was initially planned for late 2022.
• This is due to the recent market failures in order to ensure investors’ protection.
• The country remains an attractive destination for crypto, with over 11.6 million Filipinos owning digital assets.

Delayed Crypto Framework in Philippines

Despite a tumultuous year, the Philippines’ financial regulator decided not to rush a legal framework on the crypto industry, which was initially planned for late 2022. The Securities and Exchange Commission (SEC), headed by Emilio Aquino, revealed that previous deadlines for introducing the guidelines were moved in order to study the reasons behind the collapse of certain exchanges and ensure investors’ protection. Although there is no fixed timeline yet, Aquino suggested that it could be released by late 2023.

Partnership with University of Philippines Law Center

In 2023, SEC partnered with University of Philippines Law Center (UPLC) to work together on guidelines for digital assets. In January 2023, Implementing Rules and Regulations of Republic Act No. 11765 was opened up for public comment after being signed into law in 2022; however this act does not contain any reference to “crypto” or “blockchain”.

Central Bank Warning & Crypto Adoption

The central bank has been urging citizens not to engage in any operations with unregistered or foreign crypto exchanges and SEC has made similar recommendations regarding security products such as Gemini Derivatives in May 2023. Despite this pressure from authorities, Philippine remains one of the fastest-growing economies globally with 11.6 million Filipinos owning digital assets placing it 10th worldwide in terms of crypto adoption rate.

Legal Framework Aimed at Protection

Due to these events occurring throughout 2021-2023 related to cryptocurrencies within Philippines borders, SEC is taking precautionary measures when drafting regulations surrounding cryptocurrencies so that investors can be protected going forward when making investments within this space as well as other securities offered within their jurisdiction by foreign companies or individuals operating within their borders without registration .

Conclusion

Although there are still no clear plans set out yet surrounding legislation about cryptocurrency activities within Philippine borders, SEC is looking into ways they can protect its citizens from potential pitfalls when investing into cryptocurrency markets as well as other securities offered abroad but operating domestically without registration .