The 6 Cryptocurrency Exchanges and 19 Offshore Fintech Companies Currently Licensed in the Philippines
After almost two years since the Bangko Sentral ng Pilipinas (BSP) released cryptocurrency exchange guidelines in the Philippines, there are now 25 cryptocurrency and financial technology (fintech) companies that are currently licensed to operate in the nation-archipelago. Combined with an already stable rate of $40 million worth of cryptocurrency transactions happening in the Asian country per month, this could mean that the Philippines is on the verge of a blockchain upheaval in the region.
Out of these 25 companies, six have a BSP-issued Virtual Currency Exchange (VCE) license. These are the ones that have been allowed by the BSP to exchange cryptocurrency with Philippine Peso and vice versa – but not order-book style exchanges. The licensing guidelines and policies are geared more towards payments and remittances instead of investments, a measure which Fintech News reports could be to prevent money-laundering and terrorism financing. As a result, the six cryptocurrency exchange companies in the Philippines offer mostly rudimentary blockchain services.
The oldest of these six is Coins.ph, which offers bill payments, remittance services, mobile air-time top ups, and a digital wallet service. SCI Ventures which is the second oldest is more for streamlining international bills payments and money transfers – similar to services offered by BloomSolutions which is already a popular blockchain remittance platform for thousands of overseas Filipino workers (OFWs). The other companies are ETranss, Virtual Currency Philippines Inc, and Philippine Digital Asset Exchange (PDAX), which was co-founded by blockchain influencers Yang Yang Zhang, Nichel Gaba, and Krystian Kucharzyk. These are currently the only six companies in the Philippines that can legally trade Philippine Peso for cryptocurrency and vice versa.
Meanwhile, the other 19 companies will be operating under the Financial Technology Solutions and Offshore Virtual Currency License (FTSOVC License) which was granted by the Cagayan Economic Zone Authority (CEZA). While Bit Pinas explains that this doesn’t allow these 19 companies to trade Philippine Peso with cryptocurrency and vice versa, it allows them to run their businesses in the country while servicing only users that are outside of the country. CEZA – which has adopted the nickname Crypto Valley of Asia – has since granted principal licenses to 17 companies, regular licenses to 2 companies, while eight companies still have pending license applications. In line with its goal of becoming the next ideal investment destination for cryptocurrency, blockchain, and financial technology in Asia, CEZA is also reportedly planning the launch of a fintech university to allow Filipinos and other Asians to respond to the growing demand for blockchain specialists.
In short, it would be safe to say that CEZA’s dream for the Philippines is not that far off. While other governments move towards imposing stricter regulations on cryptocurrency, the Philippines takes a cue from Malta by opening doors to their own economy’s massive local potential for blockchain-based growth. For instance, there are currently 2.2 million OFWs across the world today – most of which haven’t yet discovered the streamlined approach to finance offered by blockchain-based exchanges. Apart from that yet-untapped resource, there’s also the Philippines’ huge entertainment industry. Sports betting is almost as popular in the Philippines as it is in Canada, the US, and the UK – countries which already offer various formats for blockchain-based betting options. Meanwhile, as a nation of music lovers, the Philippines is also home to millions of musical acts, artists, and bands – potentially adding to the growing roster of musicians who are using the new Mycelia Creative Passport, a digital container that helps musicians get a fair share of revenues for any music they create via indelible blockchain-coded “smart contracts.” With this much potential for growth, and with international fintech companies lining up to do business in the country, the Philippines might just be in for a digital gold rush.