Philippine SEC Cracks Down on Unregistered ‘Crypto’ Platforms
The Philippines’ Securities and Exchange Commission (SEC) has issued a warning regarding online platforms offering digital asset services without proper registration. These platforms are targeting Filipino users in violation of recently established guidelines. This move comes in the wake of the enforcement of SEC Memorandum Circular Nos. 4 and 5, known as the Crypto Asset Service Provider (CASP) Rules and Standards that came into effect on July 5.
Platforms Operating Without Registration
The SEC mandates that any individual or entity providing, promoting, or facilitating access to digital asset trading venues or intermediary services must register with the commission. The SEC’s advisory identified 10 platforms currently operating in the Philippines without the necessary licensing, including OKX, Bybit, MEXC, Kucoin, Bitget, Phemex, Coinex, Bitmart, Poloniex, and Kraken. The agency emphasized that these platforms do not have the required authorization, putting Filipino investors at risk of complete fund loss, lack of legal recourse, and exposure to fraud and identity theft.
Response from Bitget
Bitget, one of the mentioned platforms, responded to the SEC’s advisory by stating that the issue pertains to local registration requirements and does not reflect the integrity of its global operations. The company reassured users that all services, including trading, deposits, and withdrawals, continue uninterrupted, with funds remaining secure and backed by Evidence of Reserves. Hon Ng, Chief Legal Officer at Bitget, mentioned that the company is actively pursuing regulatory approvals in various jurisdictions and is open to engaging in formal dialogue with the SEC to address registration concerns.
Potential Risks and Legal Consequences
The SEC outlined the risks associated with dealing with unregistered platforms, emphasizing the lack of legal protection for users in the event of asset loss or theft. These platforms also expose investors to market manipulation and scams. The regulatory body cautioned that platforms not mentioned in the advisory but offering similar services without registration are also violating securities laws. Moreover, the SEC warned that unregistered digital asset platforms could be exploited for illicit activities such as money laundering and terrorist financing.
Enforcement Measures and Public Assistance
The SEC declared its intention to take legal and regulatory action against offenders, including issuing cease and desist orders, requests to block access to websites and mobile apps, and filing criminal complaints under relevant laws. The commission stressed the importance of reporting any suspicious activity related to unauthorized cryptocurrency offerings to the appropriate divisions within the agency. Additionally, the SEC advised the public against investing or transacting on unregistered platforms and cautioned against relying on promotions or influencers targeting Filipino investors.
Conclusion
The crackdown on unregistered ‘crypto’ platforms by the Philippine SEC underscores the significance of regulatory compliance and investor protection in the digital asset space. As the commission continues its enforcement initiatives, both users and platforms are urged to adhere to the established rules and standards to ensure a secure and transparent crypto market in the Philippines.
