Philippines SEC Proposes New Crypto Rules, but Will the People Agree?

The Philippine Securities and Exchange Commission (SEC) has released a draft of its “Crypto-Assets Service Providers (CASP) Rules.” These proposed rules aim to regulate the fast-growing cryptocurrency market in the country, focusing on safety, transparency, and accountability. The SEC is inviting public feedback to finalize the framework.

What the CASP Rules Cover

The draft defines crypto-assets as digital representations of value that rely on distributed ledger technology. The rules will regulate key activities like trading, custody, public offerings, and marketing of cryptocurrencies.

Crypto service providers must register with the SEC and obtain licenses to comply with the Financial Products and Services Consumer Protection Act (FCPA), which aims to protect investors.

New Requirements for Public Offerings

Companies offering crypto-assets to the public must submit detailed disclosure documents to the SEC at least 30 days before marketing begins. These documents need to include:

• The company’s background
• The technology behind the crypto asset
• Potential risks
• Possible loss of value

This level of detail helps ensure investors have all the information they need to make informed decisions.

Focus on Security and Fraud Prevention

The draft rules highlight the importance of strong cybersecurity and anti-money laundering practices. Service providers must follow the National Cybersecurity Plan and undergo regular system audits to stay ahead of emerging threats.

There are also strict rules to prevent insider trading, market manipulation, and fraudulent activities, reinforcing trust and integrity in the crypto market.

The SEC is inviting stakeholders to share their feedback on the proposed rules by January 18, 2025. This collaborative approach aims to create regulations that are fair, practical, and supportive of the crypto industry’s growth.

Why the Philippines is Leading in Crypto

With a young and tech-savvy population—the average age being just 25.3 years—the Philippines has become a global leader in cryptocurrency adoption. As over 562 million people worldwide use crypto-assets, strong regulations are increasingly necessary to address risks like fraud and manipulation.

The proposed CASP Rules mark a major step in balancing market growth with investor protection. By introducing these measures, the Philippines aims to strengthen its position in the global crypto market while ensuring safety and trust for all participants.

Balancing innovation and protection, this framework could shape the future of crypto.