BSP to tighten licensing for e-money, cryptocurrency firms

The Bangko Sentral ng Pilipinas (BSP) is keen on requiring entities applying for licenses as electronic money issuers (EMI) to also apply for a license as a crypto or virtual currency (VC) exchange.

BSP deputy governor Chuchi Fonacier said monetary officials are currently reviewing business models submitted by some entities since some of these require another layer of authorization and not simply for VC exchange or EMI operations.

She said some proposals have “some kind of variation in the business model that is why we are carefully looking at that and now we might require (them), apart from being a VC exchange, (to) also (have) an EMI license.”

“We will require them to obtain a license as an electronic money issuer,” she told journalists at the sidelines of the Chamber of Thrift Banks (CTB) convention in Makati Shangri La on Tuesday, April 10.

EMI applicants are required to have a capital of about P100 million.

Earlier, Fonacier said they are currently assessing 29 applications as VC exchanges.

On February 6, 2017, the central bank issued Circular No. 944 requiring companies that intend to transact VCs to register as remittance and transfer companies (RTCs).

Before this, the central bank issued a warning in March 2014 urging the public to be cautious in using VCs as these remain unregulated.

To date, the central bank has approved the operations of two entities involved in Bitcoin exchange, both of which are considered as remittance companies and are therefore required to meet rules on anti-money laundering, among others.

BSP data show that latest transaction data from these two companies, namely Rebittance and Bitour or Coins.ph, showed a big jump in VC transactions in the domestic economy, from about $2 million per month in 2015 to around $6 million a month the following year.

VCs were introduced around 2009 and the most famous among these is Bitcoin, which remain unregulated since no central bank in the world has ever issued it.

These are being used through online transactions to purchase virtual goods as well as real items and services provided by retailers and restaurants, among others. — Joann Villanueva (PNA)

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