The Central Bank of the Philippines, the country’s main regulator of the crypto industry, has warned investors against working with unregistered foreign crypto service providers. They “may create additional challenges in enforcing legal recourse, consumer protection and redress mechanisms for local clients alike,” the regulator said.
Philippine Central Bank’s Crypto Warning
The Central Bank of the Philippines (BSP) on Tuesday issued a public warning against unregistered and foreign crypto service providers. In the Philippines, the central bank is the main regulator of the crypto industry.
The announcement stated:
Bangko Sentral ng Pilipinas (Bangko Sentral) strongly urges the public not to deal with virtual asset service providers (VASPs) that are not registered or registered abroad.
As of June, 19 VASPs had registered, according to the central bank’s website.
In addition to the price volatility risks associated with virtual assets (VAs), the central bank explained that foreign-based VASPs “may present additional challenges in enforcing legal recourse, consumer protection and remediation mechanisms for local clients. “
The Central Bank emphasized:
VA trading is generally considered a high-risk activity that can lead to huge financial losses due to price fluctuations.
Additionally, the central bank warned that the government does not guarantee protection against financial losses due to cryptocurrency price volatility. “The public should exercise caution, conduct their own due diligence and always be aware of risks before engaging in VA-related activities,” the regulator stressed.
Bangko Sentral ng Pilipinas urges the public to immediately report illegal activities facilitated through cryptocurrencies and/or crypto service providers to the Central Bank.
Last week, the central bank Announce Starting September 1, it will stop accepting applications for new VASP licenses for three years. The regulator explained that it “aims to strike a balance between fostering innovation in the financial sector and ensuring that associated risks remain at manageable levels.”
What do you think of the Philippine central bank’s warning? Let us know in the comments section below.
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