P2E Headlines: Binance and the Philippine Central Bank

By: Earl Carlo Guevarra | June 21, 2022
P2E Headlines: Binance and the Philippine Central Bank

Just a couple of days ago, a Filipino policy think tank called InfraWatch PH has petitioned the Bangko Sentral ng Pilipinas (BSP), the country’s central bank, to consider banning the operation of Binance, a global centralized cryptocurrency exchange, in the country.

 

It cited regulatory risks as well as the fact that Binance does not have a virtual asset services provider (VASP) license in the Philippines, which could lead to millions of Filipinos unable to get legal and practical protection from the BSP if Binance ever fails in its financial obligations as a centralized exchange.

 

In addition, Binance does not currently possess a Certificate Authority from the BSP and registration from the Securities and Exchange Commission (SEC). While the former is a document that’s significant in local circles, one could argue that the latter document is a part and parcel of every legitimate company that wants to operate in the Philippines, physically or otherwise: Schools, foundations, SMEs, and other entities are required to have a SEC registration certificate to start with.

 

As context, the think tank has mentioned that Binance is either banned or suspended in 13 countries including the United States, Japan, Canada, Thailand, Indonesia, and Singapore, among others.

 

Why does this development matter?

 

From a macro point of view, Binance’s issue with the Philippine central bank is of significance – simple because the Philippines is home to the world’s largest NFT ownership, as well as one of the mainstays of the global play-to-earn (P2E)/non-fungible token (NFT) gaming market. Being one of the world’s primary centralized cryptocurrency exchanges 

 

From a micro point of view, Binance isn’t just a centralized exchange for Filipino cryptocurrency and blockchain gaming users. It also serves as a frontline service that allows Filipinos to monitor their digital assets, deposit into new financial instruments, participate in a digital economy, and withdraw/liquidate much-needed money that they use for their day-to-day needs.

 

Will this affect the P2E/NFT gaming space?

 

If and when the BSP decides to take severe regulatory actions against Binance (which might depend on whether they view the transport think tank’s concerns as relevant) – will determine the amount of disruption that the P2E/NFT gaming space will suffer. With that being said, Binance is aware of these issues – and would most probably do its best to remedy its current situation.

 

Do you think that Binance will be able to comply with Philippine regulatory requirements? What do you think about the future of the centralized exchange in the country?

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