Home / Cryptocurrency / Philippines issues new rules on acquiring cryptocurrency assets, Business News

Philippines issues new rules on acquiring cryptocurrency assets, Business News

Self-regulatory organization (SRO) to help enforce regulations,
code of conduct

Media OutReach

 – 4 February 2019 –

The Philippines, through the Cagayan Economic Zone Authority
(CEZA), unveils a comprehensive set of new rules governing cryptocurrencies in a bid
to effectively regulate and protect investors.

CEZA has approved the Digital Asset Token Offering (DATO)
regulations that cover the acquisition of crypto assets, including
utility and security tokens. Under the new framework, CEZA is the
principal regulating authority. The Asia Blockchain and Crypto
Association (“ABACA”) is designated as a SRO to help implement and
enforce the new rules.

“It is our goal to provide a clear set of rules and guidelines that
will foster innovation yet ensure proper compliance by actors in
the ecosystem. It is our hope that these set of regulatory
innovations will take the digital asset sector one step closer to
adoption and acceptance by institutions and the traditional
financial system,” said Sec. Raul Lambino, CEZA administrator and
chief executive officer.

Under the rules, all DATOs must have proper offering documents with
pertinent details on the issuer, project, and accompanying advice
and certification of experts and DA Agents. Tokens must be listed
on the licensed Offshore Virtual Currency Exchange (OVCE).
Stakeholders must also have confirmed arrangements with accredited
wallet providers and custodians.

The regulations cover three levels of DATO. Tier 1 involves assets
and investments not exceeding $5M with payment made in digital
tokens. Tier 2 covers $6M to $10M in investments, while Tier 3
covers investments exceeding $10M.

Utility tokens, also known as app coins or user tokens, give
holders future access to the products or services offered by a
company. Security tokens, meanwhile, are backed by real assets such
as equity, shares of a limited partnership company, or commodities.
These are used to pay dividends, share profits, pay interest or
invest in other tokens or assets to generate profits for the token

The power of the blockchain and digitization of securities and
assets are seen to make a big impact on the fintech space in the
long run. CEZA’s new DATO rules will provide much needed change to
the industry and encourage innovators to use new technologies

“The safeguards built into CEZA’s rules and system will lead to
greater investor protection and transparency. The involvement of DA
agents and experts bring in competent and neutral third parties
into the process to help ensure issuers are truthful and accurate,”
Lambino explains.

Lambino said CEZA has built an ecosystem of OVCEs where tokens of
issuers can be listed. CEZA and ABACA have also approved wallet
providers and insured digital asset custodians to ensure proper
storage and governance of investor proceeds.

ABACA, as a newly-appointed SRO, will help the government regulate
cryptocurrency companies by effectively converting industry players
into enforcers. The SRO is enforcing a code of conduct among the
members and reports to CEZA any breach, violations, or any matters
relating to OVCE rules and regulations.

CEZA has emphasized that collaboration with locator fintech firms
and industry players will help the government gain insights and
keep up to date with innovations on the emerging markets. The
economic zone authority is using research on national and
international business standards to efficiently regulate the
industries and licensees under its jurisdiction.

“The SRO model allows industry players to police its own ranks,
while also promoting and protecting the interests of cryptocurrency
investors. The rules will remain stringent in assessing the ethics
and integrity of companies eyeing to launch Digital Asset Token
Offerings” says Ma. Juanita Cueto, Chairperson of ABACA.

“CEZA is moving forward with its goal to develop the economic zone
as the center of fintech firms in Southeast and Northeast Asia. The
economic zone authority has already approved and issued provisional
principal offshore virtual currency exchange licenses to 19
companies engaged in the blockchain ecosystem industries.


ABACA is a self-regulatory organization (SRO) granted under the
authority of the CEZA. ABACA self-regulates the code of ethics and
compliance with best practices and industry standards for the
financial technology firms operating within, or in affiliation with
CEZA and ABACA members.

news POST

Purchase this article for republication.

Source link

Check Also

Quadriga: The cryptocurrency exchange that lost $135m

Image copyright Facebook/Quadriga Image caption Gerald Cotten When the 30-year-old founder of a Canadian cryptocurrency …