BSP approves operations of 3 new VC exchanges

THE CENTRAL BANK has okayed the operations of new virtual currency exchange firms. — BW FILE PHOTO

THE CENTRAL BANK approved last month the operations of three new virtual currency (VC) exchanges in the Philippines.

Data from the Technology Risk and Innovation Supervision Department of the Bangko Sentral ng Pilipinas (BSP) showed that three new players have been given the green light to process cash to virtual currency conversions.

These are Bexpress Inc., Coinville Phils. Inc., and ABA Global Phils., Inc., bringing to 10 the number of licensed cryptocurrency exchanges in the country as of March 31.

Cryptocurrencies like Bitcoin, Ethereum and Ripple are virtual currencies that are not regulated by any state or central bank. These digital coins can also be used to pay for goods through the Internet and can be treated as an investment, given their fluctuating valuations.

These three service providers join the ranks of Betur Inc. (Coins.ph); Rebittance Inc.; BloomSolutions Inc.; Virtual Currency Philippines, Inc.; eTranss Remittance International Corp.; Fyntegrate, Inc.; and Zybi Tech, Inc. as the licensed VC exchanges in the country.

The BSP has long recognized the benefits of using digital currencies in terms of faster and cheaper remittances. However, the regulator has issued several warnings to the public against the risks of rapidly-changing values, potential use for crimes, and cybersecurity issues.

The central bank issued Circular 944 in February 2017 to regulate firms which convert cash into virtual currencies like bitcoin and ethereum. The BSP imposed requirements for risk management and against money laundering on these VC exchanges, amid increased usage.

In March, the regulator also reminded banks with plans to offer VC conversions and withdrawals via automated teller machines must be registered and cleared by the BSP.

The value of Bitcoin — which is the most widely-traded digital currency — has fluctuated from a peak of $9,846 in May 2018 to $3,897 at end-2018. Its value has dipped to $5,058 per unit on April 7, while market value is at $93.238 billion, according to Bitcoin.com. — Melissa Luz T. Lopez