Philippines brings in new rules on crypto assets
The Philippines is laying down the law with some new rules governing cryptocurrencies in a bid to regulate and protect investors.
The Cagayan Economic Zone Authority (CEZA) has approved the digital asset token offering (DATO) regulations that cover the acquisition of crypto assets, including utility and security tokens.
Under the new framework, CEZA is the principal regulating authority. The Asia Blockchain and Crypto Association (ABACA) is designated as a self-regulatory organisation (SRO) to help implement and enforce the new rules.
“It is our hope that these set of regulatory innovations will take the digital asset sector one step closer to adoption and acceptance by institutions and the traditional financial system,” says Sec. Raul Lambino, CEZA administrator and CEO.
Under the rules, all DATOs must have proper offering documents with pertinent details on the issuer, project, and accompanying advice and certification of experts and DA agents.
Tokens must be listed on the licensed offshore virtual currency exchange (OVCE). Stakeholders must also have confirmed arrangements with accredited wallet providers and custodians.
Utility tokens, also known as app coins or user tokens, give holders future access to the products or services offered by a company.
Security tokens, meanwhile, are backed by real assets such as equity, shares of a limited partnership company, or commodities. These are used to pay dividends, share profits, pay interest or invest in other tokens or assets to generate profits for the token holders.
Along with this, CEZA adds that it has emphasised that collaboration with locator fintech firms and industry players will help the government gain insights and keep up to date with innovations on the emerging markets.
“The SRO model allows industry players to police its own ranks, while also promoting and protecting the interests of cryptocurrency investors. The rules will remain stringent in assessing the ethics and integrity of companies eyeing to launch DATOs,” comments Juanita Cueto, chairperson of ABACA.
CEZA has approved and issued provisional principal offshore virtual currency exchange licences to 19 companies engaged in the blockchain ecosystem industries.
The crypto space is a funny place… and to quote rock legend Lou Reed (who was singing about non-crypto matters): “Something like a circus or a sewer.”
Today (5 February), we reported that the CEO of Canadian crypto exchange QuadrigaCX died and up to $190 million in client’s funds are trapped as a result.
Last month, the Monetary Authority of Singapore (MAS) was warning the public not to be misled by fake websites that solicit investments in cryptocurrencies using fabricated information attributed to the Singapore government.
In addition, confusion emerged as crypto exchange Liqui decided to close because it was no longer able to provide liquidity for its users left.
Remember, these are just recent events.