A draft of the Securities and Exchange Commission Philippines’ framework for regulating cryptocurrencies was made public.
Feedback on the draft is requested from stakeholders by January 18, 2025. “SEC Rules on Crypto-Assets Service Providers (CASP Rules)” is the title of the released regulatory draft, according to the recently shared document.
The framework addresses a variety of cryptocurrency trading activities, such as market activity, public offers, and the prerequisites for obtaining a license issued by the SEC.
The SEC Philippines stressed the significance of establishing a cryptocurrency regulatory framework, given the country’s explosive growth in the industry.
The continued growth and development of new crypto asset markets, services, and business models relies on clear, proportionate, and robust regulatory frameworks, which can ensure that markets are fair, efficient, and transparent.”
As a result, the SEC suggested in the draft that in order for crypto service providers to operate in the Philippines, they must register with the SEC and acquire a CASP license.
Additionally, until January 18, 2025, stakeholders are encouraged to provide feedback on the regulatory framework.
Companies must meet the minimum capital criteria stipulated by the SEC, have a stock corporation registered with the SEC, have at least four employees who live in the nation, and adhere to the standards specified in the framework in order to be eligible for a CASP license.
The SEC will look into a crypto firm’s daily operations and business dealings to find any wrongdoings if it believes that a registered firm has broken the rules specified in the framework.
Examples of sanctions include a cease and desist order, fines, and the cancellation of the CASP license.
CASP license holders are expected to integrate their systems with the National Cybersecurity Plan to reduce the risk of money laundering and cybersecurity threats.
They must also undergo routine audits and review processes to ensure their systems are safe from new threats.
However, businesses that want to sell or distribute cryptocurrency assets through public offerings must first provide the SEC with a disclosure form.
At least 30 days prior to the actual offering, the document must be posted on the company’s website and any social media channels.
Information about the crypto asset issuer and offeror, the underlying technology, the rights and responsibilities associated with the crypto asset, potential hazards, and cautions regarding potential value loss should all be included in the disclosure document.
The document also contains a unique clause that forbids insider trading, market manipulation, and the illicit publication of information.
Philippine SEC Chair Emilio B. Aquino announced in May 2024 that by the second half of 2024, the government agency would implement rules to control cryptocurrency trading.
The news was made a few months after the Philippine SEC prohibited Binance from conducting business without a license.
