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Bitcoin startups are often hindered in their efforts by rather strict regulation. Even though cryptocurrency has made an impact in the Philippines already, the regulatory guidelines remain somewhat of a hurdle. That has come to change, as recent changes seemingly favor companies dealing with bitcoin. In the end, this is a positive change that may benefit bitcoin adoption in the Philippines moving forward.
The Guidelines for Virtual Currency Exchanges document contains some intriguing information. On the one hand, the Bangko Sentral acknowledges the disruptive success of bitcoin and cryptocurrencies. With faster and more convenient trades and transactions, it is evident cryptocurrency has a leg up over traditional offerings. However, virtual currencies are a systemic risk for money laundering and terrorist financing as well.
A Boost for Bitcoin Adoption in The Philippines
Similar concerns have been voiced by regulators all over the world. Albeit bitcoin is one of the most transparent financial systems in the world, policymakers remain wary. That is not entirely surprising by any means, as bitcoin operates outside of the control of banks and governments. For the time being, Bangko Sentral will not endorse bitcoin or virtual currencies as legal tender.
All things considered, this type of regulation is quite positive for bitcoin startups in the region. The government could have shut down all companies in the Philippines as well, had they wanted to.Fortunately, that was not their objective by any means. Instead, the government and central bank see bitcoin as a vital part of the Philippines’ development.
As was to be expected, some people feel these regulations are not strict enough. A lot of use cases for bitcoin and cryptocurrency are not addressed by these guidelines. It appears the regulation mainly focuses on remittance services, rather than fintech, gambling, or other prominent industries. Companies not involved in remittance may not necessarily contribute resources to meeting these regulatory standards.
In the end, it is good to see bitcoin come out of its “gray area” in the Philippines. None of the enterprises in the country are happy about operating on the fringes of society. Now that these guidelines are in place, bitcoin adoption can thrive. Considering nearly every startup has issues with their banks, these new guidelines should alleviate some of these concerns. It will be interesting to see how the bitcoin ecosystem evolves in the Philippines over the next few years.
Header image courtesy of Shutterstock
