Philippines Postpones Crypto Rules Release to Study FTX Fiasco

The Philippines may have to wait longer to have proper cryptocurrency regulations after the country's financial regulator postponed the release of a legal framework for the industry.

According to a local media report, Emilio Aquino, the Chairman of the Philippines’ Securities and Exchange Commission (SEC), said the postponement of the release of the guidelines was meant to give the regulator time to assess how best to protect investors after the collapse of FTX.

Philippines Cautious after FTX Fiasco

However, Aquino said that the work on the guidelines was ongoing, and the legal framework could still be released in 2023 after the regulator has studied the reasons behind the fall of the Bahamas-based crypto exchange.

"We were supposed to bring it out late last year, but we don't want people to get burned," Aquino originally commented in Filipino and was translated to English using Google Translate. "The issuance of digital assets is a form of capital raising, and we have to study that because, like in FTX, they were transferring billions left, right, and center."

FTX was a cryptocurrency derivatives exchange that collapsed in November last year after a bank run. It was ranked among the industry's top digital asset trading platforms. Sam Bankman-Fried, the exchange's Founder and former CEO, was later arrested and extradited from the Bahamas to face criminal charges in the US.

The events around the collapse and the huge amount of losses it brought to investors, estimated to be in the billions ($), have forced the Philippines to tighten its rules on digital assets before having a legal framework in place. In May, the Southeast Asian country warned against a crypto derivatives platform launched in the country by Gemini.

Gemini, Binance Face Regulatory Pressure in the Philippines

In a regulatory notice, the SEC in the Philippines said that Gemini Trust Company, the parent company behind its namesake exchange, was not registered with the commission and operated without a necessary license or authority. Gemini launched the derivatives exchange outside the US, and the Philippines was among the countries where the platform went live.

Furthermore, Finance Magnates reported that Binance, currently the largest cryptocurrency trading platform by volume, was planning to acquire two licenses, the virtual asset service provider (VASP) and the electronic money issuer (EMI) licenses, in the Philippines.

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