The Securities and Exchange Commission (SEC), the corporate regulator, is developing a legal and regulatory framework to address issues surrounding cryptocurrencies.
Toward this end, the SEC partnered with the University of the Philippines Law Center (UPLC) to come up with better policies that would strengthen regulation of financial technology (fintech) in the country.
In all, the SEC and UPLC aim to further understand the evolving regulatory landscape surrounding fintech, for the formulation of new policies that may be applied in the Philippines.
SEC chairperson Emilio Aquino said the aim is to issue rules suited for cryptocurrencies and blockchain technology. The rules will also govern the issuance and regulation of digital asset exchanges.
“At present, we at the SEC have been making use of laws and regulations tailored for traditional securities. Although these principles were laid down in the 1930s, they are considerably effective against cryptocurrency scams that are just run-off-the-mill Ponzi schemes,” Aquino said.
At the same time, he recognized that there is room to strengthen regulation on fintech, especially with the changing landscape.
In a ceremony held last month, the SEC and the UPLC signed a Memorandum of Understanding (MOU) for the conduct of joint research projects, capacity building and policy analysis, and resource and information sharing concerning fintech.
Under the partnership, the UPLC will provide aid in the creation of a legal and regulatory framework to initially address issues surrounding cryptocurrencies.
Eventually, the partnership would also address other fintech products and their corresponding regulation.
The SEC, for its part, will provide resources to help support activities that may be conducted by the UPLC regarding cryptocurrencies and fintech activities.
UP College of Law Dean Edgardo Carlo Vistan II said the collaboration with the SEC would help address challenges brought about by new technologies.
The SEC has been stepping up efforts to regulate fintech and understand the evolving technological landscape.
In 2021, the regulator established the PhiliFintech Innovation Office in order to understand and better regulate the use of fintech in the Philippines.
The new office is intended to serve as the first point of contact for fintech companies applying for registration, or existing fintech companies that have been operating or are introducing new fintech products, in navigating the Commission’s regulatory landscape.
For years now, the SEC has been drafting rules on digital asset exchanges to ensure that the exchange of such assets meet global standards on investor protection, market integrity, and transparency.