The Philippines Securities and Exchange Commission (SEC) has given Binance, the world’s largest cryptocurrency exchange by trading volume, a three-month grace period to register as a virtual asset service provider (VASP) in the country or face a ban, according to a report from local news BitPinas.
The SEC issued an advisory to Binance on Nov. 28, 2023, stating that the exchange was operating without a license and warning the public of the risks of dealing with unregistered entities. The advisory also said that Binance was not authorized to solicit investments or offer securities in the Philippines.
The advisory came after the SEC received complaints from Filipino investors who claimed they lost money on Binance’s platform due to technical glitches, unauthorized transactions, and account hacks.
According to Kelvin Lee, the head of the SEC, there has been a lot of confusion on the internet about the ban. In a panel on Dec. 13, 2023, he clarified that the ban would take effect three months after the advisory was issued, which was on November 29, 2023.
Depending on how feedback is, we can actually extend that, but currently, we should feel lucky with the three months, said Lee.
Binance Not the Only Target
Lee also said that Binance was not the only exchange that was issued with an advisory for unregistered operations. He said that OctaFX and MiTrade, two other exchanges, also faced bans after three months.
He said that the SEC had a sizable list of unregistered exchanges that would gradually emerge. However, he said that the SEC was also trying a “wait-and-see” approach on whether or not the exchanges would register after seeing the action taken against Binance.
He said that the SEC was not against cryptocurrency or innovation but rather concerned about consumer protection and compliance.
Lee Advocates Compliance Amid Binance Ban
Lee said that he received criticism regarding the Binance ban because it was “cheaper” than other registered exchanges.
Of course, they are cheaper because they never bothered to register in the Philippines and bothered to comply […] Unlike the registered entities, there is of course compliance costs, said Lee.
Lee emphasized the importance of local investors channeling their investments into registered entities. He highlighted that the country currently accommodates 17 VASPs that provide fiat-to-crypto services and are duly registered.
Lee stressed the pivotal significance of registration and underscored its direct correlation with safeguarding consumer interests. He strongly advocated for collaboration with the registered entities to ensure a secure and regulated investment landscape.
Related Reading | Binance Challenges SEC’s Case: Asserting Irrelevance Of $4.3B Settlement
