- The Philippines’ central bank issued a public warning to citizens about unregistered and foreign crypto service providers.
- Frauds and scams contribute to a large portion of cryptocurrency-based crimes.
- BSP explains the public needs to be cautious, conduct their own research and understand the risks before engaging in cryptocurrency activities.
On August 16, the Philippines’ central bank issued a public warning to the citizens regarding unregistered and foreign crypto service providers.
The notice states:
The Bangko Sentral ng Pilipinas (Bangko Sentral) strongly urges the public not to deal with Virtual Asset Service Providers (VASPs) that are either unregistered or domiciled abroad.
The risk of price volatility associated with VASPs, challenge of enforcing legal recourse and consumer protection are some of the many reasons why the central bank notified the public about the risks involved when engaging with unregistered and foreign cryptocurrency exchanges.
VASPs such as Bloomsolutions Inc., Moneybees Forex Corp., PHILBIT, and PDAX are among the 19 registered crypto service providers as of June 2022.
Furthermore, BSP informed that both the government and registered VASPs do not guarantee protection against financial losses from cryptocurrency. Recent data has shown frauds and scams contribute to a large portion of Virtual Assets (VA) based crimes, including cryptocurrency.
BSP also added that the public needs to be cautious, conduct their own research, and understand the risks before engaging in cryptocurrency-based activities.
In a memorandum dated August 10, the central bank announced that it will stop accepting crypto license applications for three years, starting next month. The main aim was to maintain a balance between promoting innovation in the financial sector and reducing the risks within a manageable level.
BSP also urged the public to immediately report unlawful activities to the central bank that arise through cryptocurrencies or crypto service providers.