Accelerated Growth in Crypto Activity Promts Philippine Central Bank to Expand Cryptocurrency Regulation

By: Dickson Arinze

Accelerated Growth in Crypto Activity Prompts Philippine Central Bank to Expand Cryptocurrency Regulation

January 28, 2021 7:11 PM

Cryptocurrency is becoming more popular in Philippines and has caught the attention of Central bank of Philippine.


The Bangko Sentral ng Pilipinas (BSP), has just expanded the country’s cryptocurrency regulation after seeing what they tagged as “accelerated

 growth” in the use of crypto exchanges and wallets. The new regulatory framework will be in line with the guidelines recommended by the Financial Action Task Force (FATF), the central bank says.


The new guidelines on virtual asset service providers was announces on Tuesday by the the Bangkok central ng pilipinas (BSP)
BSP Governor Benjamin E. Diokno commented:

We have seen accelerated growth in the use VCEs in the past three years and it is high time that we broaden the scope of existing regulations in recognition of the evolving nature of this financial innovation and set out commensurate risk management expectations.

“​The Monetary Board (MB) approved the guidelines on virtual asset service providers (VASP), or entities that facilitate financial services through the conduct of virtual asset (VA) activities, to cover new business models and activities,” the central bank explained.


Governor Diokno added:

This will ensure that activities relating to VASP are executed within an unbroken chain of regulated entities.


The new guidelines amend the existing regulations on cryptocurrency exchanges that were issued in 2017. The central bank says that the new regulatory framework “is aligned with fintech industry’s best practices and is consistent with risk management standards set by international standard-setting bodies such as the Financial Action Task Force (FATF)” on anti-money laundering (AML), combating the financing of terrorism (CFT), and proliferation financing (PF).


“The MB-approved framework expanded the activities subject to the licensing regime of the Bangko Sentral from initially covering those involved in facilitating the exchange of fiat and VA,” the central bank described.


The added activities are exchanging between one or more cryptocurrencies, transferring of cryptocurrencies, and the “safekeeping and/or administration of VAs or instruments enabling control over VAs.” Entities engaged in these activities will now be “subject to the BSP’s licensing requirements, regulatory expectations for money service businesses (MSB)” as well as AML, CFT, and PF obligations.