Rules on trading of crypto-assets out

MANILA, Philippines —  The Securities and Exchange Commission (SEC) has issued the rules to regulate the marketing, issuance and trading of crypto-assets, as well as the registration and operation of crypto-asset service providers (CASPs) in the country.

Through the rules, the SEC aims to balance the promotion of innovative securities and technology-based ventures, while ensuring market integrity and investor protection.

A CASP is defined as “a business entity that offers or engages in the provision of one or more crypto-asset services, including the operation of a digital platform that provides such services.”

The SEC said that both the CASP rules and the CASP guidelines apply to all CASPs that are offering crypto-asset services as well as third-party service providers who engage in the marketing of crypto-assets and crypto-asset services.

The commission is empowered to regulate and supervise the conduct of CASPs by requiring the registration, licensing and disclosures pertaining to crypto-assets, crypto-asset services, marketing of the aforementioned and crypto-asset securities pursuant to the CASP Rules.

“Crypto-assets and crypto-asset securities shall not be sold or offered for sale or distribution in the country without a disclosure document or registration statement, as the case may be, duly filed with and approved by the commission,” the SEC said.

“Similarly, no person or entity shall engage in the marketing or inducement to purchase crypto-assets or crypto-asset services unless they are registered as a corporation and have obtained the necessary licenses from the concerned regulatory agencies, such as the SEC and Bangko Sentral ng Pilipinas,” it said.

The CASP guidelines require CASPs to register as a corporation with a minimum paid-up capital of P100 million in cash or property, excluding crypto-assets.

They must also have a physical office, which must be appropriately staffed or manned during regular business hours.

Applications for registration must be accompanied by an initial filing fee of P50,000, after which CASPs will pay the SEC a supervision fee based on their gross revenue during the preceding year, for the privilege of doing business.

MANILA, Philippines —  The Securities and Exchange Commission (SEC) has issued the rules to regulate the marketing, issuance and trading of crypto-assets, as well as the registration and operation of crypto-asset service providers (CASPs) in the country.

Through the rules, the SEC aims to balance the promotion of innovative securities and technology-based ventures, while ensuring market integrity and investor protection.

A CASP is defined as “a business entity that offers or engages in the provision of one or more crypto-asset services, including the operation of a digital platform that provides such services.”

The SEC said that both the CASP rules and the CASP guidelines apply to all CASPs that are offering crypto-asset services as well as third-party service providers who engage in the marketing of crypto-assets and crypto-asset services.

The commission is empowered to regulate and supervise the conduct of CASPs by requiring the registration, licensing and disclosures pertaining to crypto-assets, crypto-asset services, marketing of the aforementioned and crypto-asset securities pursuant to the CASP Rules.

“Crypto-assets and crypto-asset securities shall not be sold or offered for sale or distribution in the country without a disclosure document or registration statement, as the case may be, duly filed with and approved by the commission,” the SEC said.

“Similarly, no person or entity shall engage in the marketing or inducement to purchase crypto-assets or crypto-asset services unless they are registered as a corporation and have obtained the necessary licenses from the concerned regulatory agencies, such as the SEC and Bangko Sentral ng Pilipinas,” it said.

The CASP guidelines require CASPs to register as a corporation with a minimum paid-up capital of P100 million in cash or property, excluding crypto-assets.

They must also have a physical office, which must be appropriately staffed or manned during regular business hours.

Applications for registration must be accompanied by an initial filing fee of P50,000, after which CASPs will pay the SEC a supervision fee based on their gross revenue during the preceding year, for the privilege of doing business.

Upon registration, the SEC said that a CASP must maintain an operational report that includes the total number of active users and daily trading summaries, which shall include the number of trades, crypto-assets traded and total settlement value, among others.

“CASPs must ensure that all available information from reputable or credible sources pertaining to the product/s being traded in the system is provided to investors,” the SEC said.

“CASPs must adhere to the principles of honest, fair and professional business conduct, ensure fair access to their platform and establish a local data center, with specific conditions for offshore IT outsourcing,” it said.

The commission can impose enforcement actions on CASPs, third-party service providers or unregistered entities for noncompliance with rules and other existing laws pertinent to its jurisdiction and authority.

According to the SEC, any person or entity who willfully violates the CASP rules and guidelines, the Securities Regulation Code, the Financial Products and Services Consumer Protection Act or other related rules or instructions issued by the commission may be punished by imprisonment of one to five years, or by a fine of P50,000 to P10 million.