Navigating the Murky Waters: The Philippines and Regulating Cryptocurrency

Navigating the Murky Waters: The Philippines and Regulating Cryptocurrency
The Philippines, a nation known for its vibrant culture and growing economy, is wading into the ever-evolving world of cryptocurrency. With the potential for both economic boon and lurking dangers, the Philippine government has set its sights on establishing a regulatory framework for cryptocurrencies by the end of 2024. This article will delve into the current state of cryptocurrency in the Philippines, explore the potential benefits and drawbacks of regulation, and offer a perspective on the path forward for this dynamic technology.

A Nation Embracing Crypto

The Philippines has emerged as a surprising leader in cryptocurrency adoption. According to a 2022 report by TripleA, a crypto research firm, 7 million Filipinos, or 6.13 of the total population, own some form of cryptocurrency.

This widespread adoption can be attributed to several factors. The Philippines has a large young population comfortable with technology, and Filipinos working abroad often use cryptocurrency for remittances, sending money back home faster and cheaper than traditional methods. Additionally, the lack of robust financial infrastructure in some areas makes cryptocurrency an attractive alternative for storing wealth and conducting transactions.

The Need for Regulation: Taming the Wild West

While the Philippines’ embrace of cryptocurrency is commendable, the current Wild West landscape poses significant challenges. The absence of regulations leaves investors vulnerable to scams, market manipulation, and hacking.

An article on Nikkei Asia reported that Philippines lacks digital literacy and cybercrime awareness and more than one-third of Filipinos surveyed had been scammed or encountered retail fraud online. In the same article, they mentioned about a study initiated by the Global Anti-Scam Alliance along with the tech security firm Gogolook based in Taiwan, gathered data from 20,000 individuals regarding their encounters with online shopping across various countries including Vietnam, China, Thailand, Hong Kong, Taiwan, Indonesia, South Korea, Japan, Malaysia, Singapore, and the Philippines. The Philippines reported the highest frequency of shopping scams, with a staggering 35.9% of respondents affected, outstripping China, which came in second at 27.2%. On the other end of the spectrum, South Korea registered the smallest percentage of such scams, with a mere 4.2% of participants reporting incidents.

The numbers of cryptocurrency scams can be worst as that lack public education. The anonymity associated with cryptocurrency transactions can facilitate money laundering and other criminal activities.

The Benefits of Regulation: Building a Sustainable Future

Regulation, if implemented thoughtfully, can usher in a new era for cryptocurrency in the Philippines. A well-defined regulatory framework would provide much-needed clarity and security for investors. Investors would be better protected from fraudulent activity, fostering trust and encouraging wider participation in the cryptocurrency market. Regulations could also establish Know Your Customer (KYC) and Anti-Money Laundering (AML) standards, deterring criminal activity and ensuring the integrity of the financial system.

In my humble opinion, regulators should focus on establishing clear guidelines for cryptocurrency exchanges and initial coin offerings (ICOs) while allowing for flexibility and adaptability in a rapidly evolving space. Additionally, the government should consider collaborating with industry experts and stakeholders to create a regulatory framework that is both effective and practical.

The Philippines can learn valuable lessons from countries that have already implemented cryptocurrency regulations. Singapore, for example, has established itself as a global hub for cryptocurrency by adopting a progressive regulatory approach. The Monetary Authority of Singapore (MAS) has issued licenses to cryptocurrency exchanges and implemented KYC/AML standards, creating a safe and secure environment for investors. Similarly, Japan has legalized cryptocurrency as a legal tender, providing a clear legal framework for its use.

The Road Ahead: Challenges and Opportunities

The Philippines faces several challenges in its quest to regulate cryptocurrency. One major hurdle is the lack of a comprehensive legal framework for digital assets. The government will need to define cryptocurrencies and establish clear rules for their issuance, trading, and use. Additionally, the Philippines needs to build capacity within its regulatory agencies to effectively oversee the cryptocurrency market.

Despite these challenges, the Philippines has a unique opportunity to become a leader in responsible cryptocurrency regulation. By striking a balance between investor protection and fostering innovation, the Philippines can create a regulatory framework that attracts businesses and investors while safeguarding its financial system.

A Personal Perspective: Embracing the Future with Caution

As a practitioner who has closely followed the development of cryptocurrency, I believe that its potential for positive change is undeniable. However, I also recognize the inherent risks associated with this nascent technology. Regulation, if implemented strategically, can be a powerful tool to harness the power of cryptocurrency for good. The Philippines has the opportunity to become a model for other nations by creating a regulatory framework that is both effective and forward-thinking. The journey ahead will not be easy, but the potential rewards are significant. By embracing innovation while safeguarding its citizens, the Philippines can navigate the murky waters of cryptocurrency and emerge as a leader in the digital age.

In Conclusion

In the quest to harness the transformative power of cryptocurrency, the Philippines stands at a pivotal crossroads. The nation’s journey towards establishing a comprehensive regulatory framework by the end of 2024 is not merely a bureaucratic endeavor but a strategic move to secure its place in the global financial landscape. The widespread adoption of cryptocurrency among Filipinos reflects a society that is both innovative and adaptive, yet the absence of regulation has left it vulnerable to the darker elements of the digital frontier.

The need for regulation is clear: to protect investors, to deter criminal activity, and to establish the Philippines as a reputable and secure environment for the burgeoning crypto economy. The benefits of such regulation are manifold, promising to bring stability, trust, and growth to a market that is currently akin to the Wild West. By learning from the successes and failures of other nations, the Philippines can craft a regulatory framework that is both robust and flexible, capable of evolving with the rapid pace of technological change.

As we look to the future, the Philippines’ approach to cryptocurrency regulation will undoubtedly serve as a case study for other nations grappling with similar challenges. With thoughtful regulation, the Philippines can mitigate the risks and unlock the full potential of this revolutionary technology. The journey will require diligence, collaboration, and a steadfast commitment to the principles of transparency and integrity. If successful, the Philippines will not only navigate the murky waters of cryptocurrency but also chart a course for others to follow, emerging as a beacon of progress in the digital age.

 

Source: https://www.benzinga.com/24/06/39338078/navigating-the-murky-waters-the-philippines-and-regulating-cryptocurrency

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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The Philippines Grapples with the Crypto Ecosystem

The Philippines Grapples with the Crypto Ecosystem

The Philippine Securities and Exchange Commission (SEC) is currently working on introducing a regulatory framework for cryptocurrencies, aiming to protect investors and maintain the integrity of the financial system. This move comes as the popularity of cryptocurrencies such as Bitcoin and Ethereum continues to grow, and as the SEC cracks down on unregistered exchanges, including the recent ban on Binance.

The SEC’s proposed regulatory framework for cryptocurrencies is a step in the right direction. The current state of the cryptocurrency market is largely unregulated, which can be risky for investors and can lead to illicit activities such as money laundering and fraud. A well-crafted regulatory framework can help address these issues and provide a level of protection for investors.

One of the key challenges facing the SEC is balancing the need for regulation with the need to promote innovation and growth in the cryptocurrency market. Overly restrictive regulations could restrain the growth of the market and drive investors and businesses away, while too lax regulations could lead to the risks mentioned above.

To address this challenge, the SEC could consider a phased approach to regulation, starting with basic requirements for exchanges and gradually increasing the requirements as the market matures. This approach would allow the SEC to monitor the market and adjust regulations as needed, while also providing a level of certainty and stability for investors and businesses.

Another important consideration for the SEC is the impact of regulation on the region. The Philippines is a member of the Association of Southeast Asian Nations (ASEAN), and the country’s financial system is closely linked to that of its neighbors. Any regulatory framework for cryptocurrencies in the Philippines would need to take into account the potential impact on the region as a whole.

In terms of statistics and data, the growth of the cryptocurrency market in the Philippines has been significant. Bangko Sentral ng Pilipinas (BSP), the country’s central bank, reported that cryptocurrency transactions in the country increased in 2023. The BSP also reported that about half of all payments in the country are now made digitally and that the country saw record numbers of foreign remittances in 2023. This growth has been driven by a combination of factors, including increased awareness and adoption of cryptocurrencies, the ease of access to exchanges and trading platforms, and the relatively low barriers to entry. According to CoinGecko, the total crypto market capitalization in the Philippines increased by 108.1% in 2023, from $829 billion to $1.72 trillion. The average daily trading volume in the fourth quarter of 2023 was $75.1 billion, a 91.9% increase from the previous quarter.

However, the growth of the cryptocurrency market has also brought with it several challenges, including the risk of fraud and the potential for market manipulation. In January 2023, the CIDG raided the offices of Oasis Hub and arrested 93 officials and employees for alleged involvement in a cryptocurrency scam. On September 13, 2023, Tamayo, also known as the “Crypto King,” was arrested in Parañaque City for allegedly defrauding at least $1.7 million from multiple victims through a cryptocurrency scam. Tamayo is accused of luring victims with promises of high returns on cryptocurrency investments.

To address these challenges, the SEC has taken several steps, including the recent ban on Binance. The SEC has also issued warnings to investors about the risks of investing in cryptocurrencies and has established a task force to monitor and regulate the cryptocurrency market.

Regarding the impact of regulation on the region, it is important to consider the potential effects on the ASEAN market as a whole. The Philippines is a significant player in the ASEAN economy, and any regulatory changes in the country could have ripple effects throughout the region.

One potential challenge for the SEC is ensuring that any regulatory framework is consistent with existing ASEAN agreements and does not create barriers to trade or investment. The ASEAN region is committed to promoting economic integration and cooperation, and any regulatory framework for cryptocurrencies in the Philippines should be designed with this goal in mind.

Another important consideration for the SEC is the potential for cryptocurrency to support the development of the ASEAN economy. Cryptocurrency has the potential to provide greater access to financial services for the unbanked and underbanked, and to support the growth of e-commerce and other digital industries. By embracing cryptocurrency and developing a regulatory framework that supports its growth, the Philippines and the ASEAN region as a whole could reap significant economic benefits.

Here are some additional points to consider when discussing the potential benefits of the SEC’s proposed regulatory framework for cryptocurrencies in the Philippines.

The proposed framework would require cryptocurrency exchanges to implement strict know-your-customer and anti-money laundering measures, which would help to prevent illicit activities such as money laundering and terrorist financing. This would provide increased protection for investors and help to build trust in the market. The framework would also require exchanges to maintain a certain level of transparency and reporting, ensuring that the market operates fairly and efficiently. This would be achieved through measures such as real-time reporting of transactions, accurate and timely disclosure of information, and the maintenance of accurate and complete records.

It would require exchanges to conduct thorough customer due diligence to ensure they are dealing with legitimate customers and not with individuals or entities subject to sanctions or other legal restrictions. This would help to prevent the misuse of the financial system and protect the integrity of the market. The proposed framework would provide greater certainty for businesses operating in the cryptocurrency space by establishing clear rules and guidelines for their operations. This would help to reduce the risk of legal challenges and regulatory uncertainty, encouraging more businesses to enter the market and invest in the sector.

It would create new job opportunities in the cryptocurrency space, requiring the establishment of a new class of professionals with expertise in areas such as blockchain technology, smart contracts, and digital assets. This would help drive economic growth and development in the country. The proposed framework would also generate increased tax revenues for the government, requiring cryptocurrency exchanges and other businesses operating in the sector to pay taxes on their profits. This would help to fund public services and infrastructure projects, contributing to the overall economic development of the country.

The proposed framework would help to improve financial inclusion in the country, providing greater access to financial services for individuals and businesses currently underserved or excluded from the traditional financial system. This would be achieved through the use of blockchain technology and other innovative financial tools, enabling more people to access a wider range of financial services. The proposed framework would enhance the reputation of the Philippines as a forward-thinking and innovative country, positioning it as a hub for financial technology and other emerging industries. This would help to attract more foreign investment, talent, and tourism, contributing to the overall economic development of the country.

The SEC’s proposed regulatory framework for cryptocurrencies is a positive step forward for the Philippines and the ASEAN region. By balancing the need for regulation with the need to promote innovation and growth, the SEC can help ensure that the cryptocurrency market in the Philippines is safe, stable, and supportive of the region’s economic development. The SEC’s proposed regulatory framework for cryptocurrencies is comprehensive and well-structured, addressing many of the key challenges facing the cryptocurrency market in the Philippines. By implementing this framework, the SEC can help to promote the growth of the cryptocurrency market, while also protecting investors and maintaining the integrity of the financial system.

Given the Philippines’ significant role in the ASEAN economy, any regulatory changes in the country could have widespread effects throughout the region. By developing a regulatory framework consistent with existing ASEAN agreements and supporting the growth of the cryptocurrency market, the SEC can promote economic integration and cooperation throughout the region.

Overall, the SEC’s proposed regulatory framework for cryptocurrencies is a positive development for the Philippines and the ASEAN region. By balancing regulation with innovation and growth, the SEC can ensure a safe and supportive cryptocurrency market, contributing to the region’s economic development.

 

Source: https://intpolicydigest.org/the-philippines-grapples-with-the-crypto-ecosystem/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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Affiliate Marketing in the Age of Blockchain: Experts Share their Views in Philippines

Affiliate Marketing in the Age of Blockchain: Experts Share their Views in Philippines

Blockchain Experts from China, Philippines and Singapore were lined up at Affiliate Conference & Expo (ACE) to share how the new technology can help affiliate marketing. Affiliate marketing meets blockchain at the first ever Affiliate Conference & Expo in Manila from 21 to 22 November 2019 at the Solaire Resort & Casino.

Trust and transparency are the some of the key missing components in affiliate marketing and coincidentally these problems can be addressed with the adoption of blockchain technology.

Anndy Lian from Singapore, book Author of Blockchain Revolution 2030 and an inter-governmental blockchain advisor gave an individual presentation on what are the vital elements needed for an affiliate marketing scheme to work well in today’s society and how blockchain helps to close up the gap. During the presentation, he described his preferred scenarios for blockchain usage for affiliate marketing. He used an incentive token model for advertising that he trialed with BreezeMaxWeb to illustrate how tokens can draw users to click and get profit by verifying the advertisements on the chain. Then using a gamification model by Gaimin to create stickiness. Last but not least using pr companies like Blockcast.cc to push out verified news within an incentivized network to encourage users to participate in the online and offline activities and promotions within the community.

“The above that I have described is something that we have trialed. The current affiliate marketing programs have a bad name and it will remain that way if we don’t bother to change it. They advertise unethically, many small disclaimers and at times the brand owners of the products are no where to be found. By introducing blockchain to their existing model, it gives users more control over the information they are exposed to, the rewards they worked hard for will also be transparent and this gives ease to the users.” Shared Anndy.

A panel comprised of Jenny Zheng- Cofounder of Blockcast.cc, Jake Villanueva- Investment Manager of Y Investments Philippines Inc, Myrtle Anne- Founder of Blockchain Tides and Anndy Lian were assembled. The panel gave candid views during the panel discussion and that started a series of questions & answers from audiences as they want to find out more.

Jake commented that there are a lot of catching up within the Philippines community on blockchain and crypto currencies. “The communities who believe in blockchain have increased a lot. I can feel the excitement and the enthusiasm. But bear in mind, we are not totally ready yet to embrace this technology. There are needs to invest into infrastructures and educated the general public what is blockchain.”

“I agree with Jake totally. Education is very important and that is why we started Blockcast.cc. This is a platform where we share. Bitcoin, speculations and blockchain technologies have to be carefully distinguished. Coming back to the point on the market not being ready, I think the Philippines market has a great advantage over the rest of ASEAN. Just like China, we skipped the era of credit cards and jumped into a new digital economy with the Alipay and WeChatPay. I strongly believe that blockchain payment can do well in this lovely country!” Jenny added.

Myrtle who is the moderator for the panel, concurred with Jenny’s observations too. “Philippines community for blockchain will grow very strong. I have seen cafes that are trying to use bitcoin as a mode of payment. This is a good move and I think they are ahead of the curve. I have also consulted a project in Philippines who is cleverly using the blockchain technology for their health business. Again, this is very heart warming and my efforts to push this technology forward are gaining adoption.”

“As you know, I do give advice to governments and businesses on blockchain. Philippines government will step up to regulate this industry and we will see more updates in 2020. You will see more trading and securities tokens (STO) regulations soon. This will give users, investors and companies more confidence. It will draw in many new adoption into this industry and I am sure Philippines will stand out from this region when the regulations are in place.” Anndy explained further.

ACE 2019 is the go-to Affiliate Marketing event in Asia for the world’s top Affiliates, Digital Marketers, Merchants and eCommerce entrepreneurs gathered under one roof. Participants network with the top successful Super Affiliates, most prominent regional & global field experts & speakers, world’s top global networks, along with top industry investors & advertisers such as Veronica Andrino, CEO/Founder, Adsolve Co; AlnaverBaltazar, CEO/Founder, SevenGrace Marketing; Melissa Francisco, Head of Sales & Business Development SEA, Optimise Media; Carlito Antonio Jao, Social Management Director, McCann Worldgroup Philippines; Prashant Kala, Country Head, ShopBack Philippines; Chris Mangeura, CMO/Head of Marketing and App Product, Mynt (Globe Fintech Innovations, Inc); Rizal Prasetya, Regional Associate Manager, Affiliates at ZALORA Group; Sean Si, CEO/Founder, SEO Hacker; Janette Toral, Founder, Digital Filipino; AnuragVerma, Head of Sales and Partnerships, Zomato Philippines; Tristan de Belloy, Founder & CEO, Quanta Digital; Ces Dimalanta, Founder/Blogger, Manila Millennial; Carlos Castaño,Head of Sales & Business for Stratuscast Philippines, Inc.; DM Varun,Co-Founder and CEO, STORM Learning; Abigail Victorino, Founder and CEO of StyleGenie; Kurt Ebarita,Social Media Manager, Bonsey Jaden Philippine; Elie Odigie, Digital Marketing and eCommerce Senior Manager, AXA Philippines; Sebastien Caudron, Content President AP, GroupM; Stanley Willer, CEO, HoGaming; Weng Rivera, Country Manager (Philippines), Booking.com; Roy Redd, Motivational Speaker, The Redd Group; Francis Simisim, CEO, Social Light Inc.; Bhavesh Parthi, Head of Affiliates, Oppa888; Munmun Nath, Head of Marketing, Moneymax Philippines.

While affiliate marketing is the key theme of the expo, for the organizers to recognize the importance of blockchain is a good start. The panel of blockchain practitioners will continue to share their knowledge regionally. For more information on blockchain related news and information, go to www.blockcast.cc. Blockcast.cc welcomes contributors from all over the world to be part of the community.

 

About Blockcast.cc

Blockcast.cc is a broadcasting news source for the blockchain community. Founded in Singapore and has a network of contributors in China, Hong Kong, Korea and Malaysia. Aim to bring you the latest blockchain insights across the globe.

 

 

Media Contacts

Company: Blockcast.cc
Contact Person: Melody Chan
Title: Editor
Contact Number: +65 9883 2707
Contact Email: contact@blockcast.cc
Website: www.blockcast.cc
Location: South Korea

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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