Legal & Regulatory

Regulatory Framework For Bitcoin Considered by the Philippine Central Bank

By Xyla Joelle L. Fernandez | Dec 23, 2016 04:10 AM EST
The Philippine central bank is now considering the digital currency regulation for them to protect consumers and this is also because of the rising numbers of the overseas filipino workers who are using bitcoin and other digital currencies. (Photo : Photo by Dondi Tawatao/Getty Images))

Philippines central bank is considering introducing digital currency regulations to protect consumers.

As the number of overseas Filipinos using bitcoin and other digital currencies to send money home is increasing, the government is ramping up efforts to protect users.

In a recent interview, Nestor Espenilla, a deputy governor at the central bank, said that the volume of transactions involving digital currencies is "rising very quickly" as they offer a cheaper and quicker way to move cash as compared to regular remittance channels.

According to Bangko Sentral ng Pilipinas, the volume of cryptocurrency-based remittance transactions have risen to at least $2 million a month. Espenilla explained that although it represents a small fraction of the record $25.8 billion of funds overseas Filipinos sent home last year, it indicates the need to regulate this sector, which is currently governed by a "mere advisory to the public".

Espenilla further suggested that the regulations will likely require virtual currency-related businesses to conduct client checks, report suspicious transactions and send data to the central bank. Philippines is currently home to a number of bitcoin-based companies including Coins.ph, Bitcoin Philippines, Satoshi Citadel Industries and others.

Last month Token Hub Asia in the Philippines celebrated its one-year anniversary as a remittance service for altcoin Eternal Coin (XEC) serving the Philippines, Japan, Hong Kong, and Korea. Owned by Japanese company Atom Solutions, it allows a user to send funds directly to a recipient's mobile phone.

Oversea-Chinese Banking Corporation (OCBC) also announced last month that it had claimed a first regional use of block chain technology for remittance by utilizing a pilot platform jointly developed with BCSIS, a local payments startup in Singapore.

In an effort to ensure that the Philippine central bank is safe from the type of cyber-heist that affected the Bangladeshi central bank, the authority announced they will be introducing a cybersecurity surveillance division.

The agency will monitor cyber threats, conduct surveillance, and test the cybersecurity infrastructure of supervised institutions.With the Philippines launching it first two-way bitcoin ATM last year, the digital currency is set to only increase in popularity as more people turn to it as the payment choice for remittance services.

Most Popular