By Melissa Luz T. Lopez, Senior Reporter
FINANCIAL FIRMS that will provide virtual exchange conversions via automated teller machines (ATMs) must get the central bank’s approval before offering such service to the public.
The Bangko Sentral ng Pilipinas (BSP) issued Memorandum 2019-006 reminding banks that any plans to offer ATM conversions and withdrawals from cash to digital coins must be registered with the regulator.
In 2017, the regulator came out with rules requiring any firm that offers the exchange of money into virtual currencies (VC) and vice-versa needs to register with the BSP.
“In this regard, operators of ATMs that allow purchase or exchange of VCs (for example, Bitcoin) or other devices with similar functionality and capability, are considered as VCE (exchanges) and should register with the BSP pursuant to Circular No. 944,” the issuance read, as signed by Deputy Governor Chuchi G. Fonacier.
Cryptocurrencies like Bitcoin, Ethereum and Ripple are virtual currencies 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.
“As registered VCEs, they should comply with anti-money laundering/terrorist financing laws and regulations, ensure sufficient and appropriate controls and governance framework are adopted to manage the associated technology and other operational risks, and put in place adequate consumer protection and customer support, among others,” the central bank said in the March 14 memorandum.
In February, the UnionBank of the Philippines, Inc. revealed it is looking to roll out the first-ever VC ATMs in the country, which will allow customers to buy and sell cryptocurrencies for cash.
UnionBank Chairman Justo A. Ortiz said they already have the machine in the country, which they will place in their flagship The ARK branch along Ayala Avenue in Makati. He added that they will tap the services of financial technology firm Coins.ph to operate the exchange.
Coins.ph was among the first companies to get a VC exchange license under its corporate name, Betur Inc.
The central bank has warned the public to take caution in using privately-issued cryptocurrency for payments and investments given its “highly speculative and volatile” nature.
The Anti-Money Laundering Council has also said it is eyeing to cover digital currencies under its watch.