The central bank of the Philippines, the primary regulator of the country’s crypto sector, has warned investors about engaging with unregistered and foreign crypto service providers. They “may present additional challenges on enforcing legal recourse and consumer protection and redress mechanisms for local customers, among others,” the regulator said.
The Philippine Central Bank’s Crypto Warnings
Bangko Sentral ng Pilipinas, the central bank in Philippines (BSP), has issued a warning to all foreign and unregistered crypto service providers on Tuesday. The primary regulator for the Philippines’ crypto sector is the central bank.
It states that:
Bangko Sentral ng Pilipinas, (Bangko Sentral), strongly encourages people to avoid dealing with virtual asset services providers (VASPs), that are not registered or domiciled in the Philippines.
The central bank’s website shows that 19 VASPs have been registered as of June.
Besides the risk from price volatility associated with virtual assets (VAs), the central bank explained that VASPs that are based abroad “may present additional challenges on enforcing legal recourse and consumer protection and redress mechanisms for local customers, among others.”
Bangko Sentral is a strong symbol of this:
Vat transactions are considered to be high-risk, and could result in large financial losses as a result of price swings.
The central bank also warned that financial losses resulting from fluctuations in crypto prices cannot be guaranteed by the government. “The public should exercise caution, conduct their own due diligence, and always be mindful of the risks prior to engaging with VA-related activities,” the regulator emphasized.
Bangko Sentral ng Pilipinas urged citizens to report illegal activities facilitated by cryptocurrencies or crypto service providers immediately to the central bank.
The central bank said last week that VASP applications will be stopped accepting for the next three years. Its suspension is effective Sept. 1. The regulator explained that it “aims to strike a balance between promoting innovation in the financial sector and ensuring that associated risks remain within manageable levels.”
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